Requirements Determine whether the following items represent taxable income. As the result of an age discrimination suit, Pat received a cash settlerment of $40,000. One-half of the settlement represented wages lost by Pat as a result of the discrimination and the balance represented an award based on personal injury. . Matt sued the local newspaper for a story that reported he was affiliated with organized crime. The court awarded him $50,000 of libel damages. b. Pam was injured in an automobile accident and received $10,000 from an employer sponsored disability policy. In addition, her employer-financed medical insurance policy reimbursed her for $15,000 of medical expenses C