Julia suffered a severe stroke and has been admitted to a private hospital where she is expected to remain for the rest of her life. She is certified by a licensed health care practitioner as being a "chronically ill individual." Her hospital expenses amount to $350 per day. She will receive $340 per day from a $500,000 life insurance policy as an accelerated death benefit. In 2018, she was in the hospital for 10 days and received $3,400. How much of this amount is taxable?

Question

Quizplus · Accepted Answer

The accelerated death benefits received by Julia are not taxable because she is certified as a "chronically ill individual," and the amount received does not exceed her actual medical expenses.

Julia Suffered a Severe Stroke and Has Been Admitted to a Private