Question 1 Youre jogging along the path by the lake when BAM youre hit from be hind by a guy on an electric bike who was looking at his phone instead of paying attention to where he was going Both you and he end up crumpled and bloody, so bystanders call 911 The police and ambulances arrive The police write a re port and issue the biker a citation ER diagnosis you had four broken bones, serious abrasions, soft tissue injuries, and a concussion Youre hospitalized for a week and miss work for six months while your brain recovers from the concussion Your insurance company recommends that you hire a lawyer, so you do Ultimately you receive the following payments from the bikers insurance company $390,000 for medical bill payments reimbursements $275,000 for ongoing future physical therapy $400,000 for permanent partial disability (left arm) $750,000 for permanent partial disability (left leg) $600,000 for pain and suffering $500,000 for lost wages loss of future earnings $250,000 for emotional distress (PTSD) $800,000 as punitive damages Also, and because you were unable to fully function in your marital capacity during your recovery and rehab period, your spouse recovers his her own $250,000 for loss of consortium The accident happened and all of the above monetary damages were received during 2019 How much, if any, of these payments should be treated as gross income on your MFJ (married filing jointly) 2019 Form 1040 Why

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Question 1. Youre jogging along the path by the lake when BAM! youre hit from be-hind by a guy on an electric bike who was

Question 1. Youre jogging along the path by the lake when BAM! youre hit from be-hind by a guy on an electric bike who was looking at his phone instead of paying attention to where he was going. Both you and he end up crumpled and bloody, so bystanders call 911. The police and ambulances arrive. The police write a re-port and issue the biker a citation.

***ER diagnosis: you had four broken bones, serious abrasions, soft-tissue injuries, and a concussion. Youre hospitalized for a week and miss work for six months while your brain recovers from the concussion. Your insurance company recommends that you hire a lawyer, so you do. Ultimately you receive the following payments from the bikers insurance company:

$390,000 for medical bill payments / reimbursements
$275,000 for ongoing & future physical therapy
$400,000 for permanent partial disability (left arm)
$750,000 for permanent partial disability (left leg)
$600,000 for pain and suffering
$500,000 for lost wages / loss of future earnings
$250,000 for emotional distress (PTSD)
$800,000 as punitive damages

Also, and because you were unable to fully function in your marital capacity during your recovery and rehab period, your spouse recovers his/her own $250,000 for loss of consortium.

The accident happened and all of the above monetary damages were received during 2019. How much, if any, of these payments should be treated as gross income on your MFJ (married filing jointly) 2019 Form 1040? Why?