Brian was injured in an automobile accident. The other driver\'s insurance compa

Question

Brian was injured in an automobile accident. The other driver's insurance company paid him $2500 to cover medical expenses and a compensatory amount of $5400 for pain and suffering. Brian should inlcude ($) of the medical expenses paid to him as gross income and ($) of the compensatory amount paid to him for pain and suffering as gross income. (Please provide the $ amount to be put)

A newspaper article stated that Eddie had been convicted of tax evasion. Eddie, in fact, had never been accused of tax evasion. He sued and won a compensatory settlement of $5500 from the paper. Eddie should include ($) as taxable gross income.  (Please provide the $ amount to be put)

Hugo, who pays the cost of a commercial disability income policy, fell and injured his back. He was unable to work for six months. The insurance company paid him $2400 per month during the time he was unable to work. Hugo should include ($) for the year as taxable income for the six months he was unable to work.  (Please provide the $ amount to be put)

Joshua fell and injured his knee. He was unable to work for four months. His employer financed disability income policy paid Joshua $1500 per month during the time he was unable to work. Joshua should inlcude ($) for the year as taxable income for the four months he was unable to work.  (Please provide the $ amount to be put)

Ralph suffered a stroke. He was unable to work for five months. His employer continued to pay Ralph his salary of $2100 per month during the time he was unable to work. Ralph should include ($) for the year as taxable income for the five months he was unable to work.  (Please provide the $ amount to be put)

Explanation / Answer

1) $2500 he receives for medical expenses and the $5400 of pain and suffering payments are excludable.

Brian should inlcude ($0) of the medical expenses paid to him as gross income and ($0) of the compensatory amount paid to him for pain and suffering as gross income.

2) Eddie should include ($5500) as taxable gross income

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