Holly was injured while working in a factory and received 12

Holly was injured while working in a factory and received $12,000 as workers’ compensation while she was unable to work because of the injury. Jill, who was self-employed, was also injured and unable to work. Jill collected $12,000 on an insurance policy she had purchased to replace her loss of income while she was unable to work. How much are Holly and Jill each required to include in their gross income?

Solution

Holly and Jill each required to inc lude their total compensation to their gross income.but in the different ways. Holly\'s compensation includes other forms of compensation such as fringe benefits and stocks options while Jill compensation includes directly in their gross income.