Gross Income Exclusions and Deductions for AGI 4-39 for each taxpayer, discuss how much (if any) 13. Physical Injury and Sickness Payments. (Obj. 1) For each taxpayer, discuss how of the payments received during the year are included in gross income. a. Anne sued her employer for discrimination and was awarded $50,000. b. Todd was physically injured on the job. He is reimbursed $16,400 for medical expenses he paid as a result of his injuries. Todd's employer paid 100% of the premiums on his health insurance policy. C. Meg was physically injured on the job. She received $12,000 of workers' compensation. d. Sandra had an adverse reaction to the drug her doctor prescribed. She sued company and was awarded $12 million. Of this amount, $11.5 million was for punitive damages