In 2014,Theresa was in an automobile accident and suffered physical injuries.The accident was caused by Ramon's negligence.In 2015,Theresa collected from his insurance company.She received $15,000 for loss of income,$10,000 for pain and suffering,$50,000 for punitive damages,and $6,000 for medical expenses which she had deducted on her 2014 tax return (the amount in excess of 10% of adjusted gross income).As a result of the above,Theresa's 2015 gross income is increased by $56,000.

Question

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The punitive damages of $50,000 must be included in Theresa's gross income.Also,the medical expenses of $6,000 deducted in 2014 must be included in 2015 gross income under the tax benefit rule.

In 2014,Theresa Was in an Automobile Accident and Suffered Physical