I:3-51 Court Awards and Insurance Settlements. What amount, if any, must be included in gross income by the following taxpayers?

a. Ann received $2,000 from her insurance company when her automobile which cost

$3,000 was stolen.

b. Barry received $3,000 from his brother. Barry had initiated a lawsuit against his brother in an effort to recover $3,000 he had previously loaned to him. The brother paid Barry back before the case was tried, and Barry dropped the lawsuit.

c. Carry, an accountant, sued a client in order to collect her fee for doing tax work.
Would Carry’s accounting method make any difference?

d. Dave has incurred $6,000 of medical expenses so far this year. He paid $400 of the expenses himself. His insurance company paid $4,000 of the expenses. The hospital is suing Dave and the insurance company for the balance, $1,600.