Question
7. Sally is driving her defective car (think the Ford Pinto) down the New Jersey Turnpike. The Ford Pinto was a car notorious for its
7. Sally is driving her defective car (think the Ford Pinto) down the New Jersey Turnpike. The Ford Pinto was a car notorious for its defective gas tank which would easily explode not a good thing for a gas tank. Sure enough, as she was driving the Pinto on the New Jersey Turnpike, she is hit by a truck and the gas tank explodes. She sues Ford and wins damages for medical expenses, loss of a leg, pain and suffering, emotional distress, punitive damages and loss of earnings. What is the treatment of these various damage awards? (Please solve this question from tax perspective)
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