Suresh is a technician working with Melissas car repair centre. Due to a dangerous workplace accident, Suresh
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Question:
Suresh is a technician working with Melissa’s car repair centre. Due to a dangerous workplace accident, Suresh became seriously ill. Suresh received compensation of $131,000. The lump sum was divided into $57,000 loss of earnings, $43,000 loss of future earning capacity and $31,000 for pain and suffering.
Questions
Based on legal provisions and case law, advise Suresh, will any of these amounts be assessable income?
Furthermore, advise Suresh whether it would be better to accept a lesser sum of $110,000 without any agreed allocation of the funds between current and future earnings and pain and suffering.
Related Book For
Federal Tax Research
ISBN: 9781285439396
10th Edition
Authors: Roby Sawyers, William Raabe, Gerald Whittenburg, Steven Gill
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