Early in the year, Marion was in an automobile accident during the course of his employment. As a result of the physical injuries he sustained, he received the following payments during the year:
Reimbursement of medical expenses Marion paid by a medical $10,000
insurance policy he purchased
Damage settlement to replace his lost salary 15,000
What is the amount that Marion must include in gross income for the current year?
a. $25,000.
b. $15,000.
c. $12,500.
d. $10,000.
e. $0.
Answer: e $0.