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Four years ago, Lyle Mercer was injured in a railroad accident and sued the railroad for damages. The jury required the railroad to pay $

Four years ago, Lyle Mercer was injured in a railroad accident and sued the railroad for damages. The jury required the railroad to pay
$565,000 compensation for his physical injuries, $229,000 for lost wages during his long recuperation, and $1,335,000 punitive
damages. Assume the taxable year is 2023.
Required:
How much of the $2,129,000 settlement is included in Lyle's gross income?
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