Edsel Posted July 29, 2017 Report Share Posted July 29, 2017 A client was rear-ended in her car. FMV of car was $12,000. Client is expecting insurance proceeds of $25,000. Form 4684 has the provision for a casualty to result in taxable income. I've just never seen this on an auto accident. Need to get a straight answer as to how the client was able to cover a $12K asset with $25K in coverage. Doesn't make sense. When I get to the bottom of this, I expect the excess is to cover medical damage. Only damage was a trip to clinic to check for whiplash. Minor expense. The way I look at this, there will be taxable income if the medical expense is what I expect it to be. Comments? Quote Link to comment Share on other sites More sharing options...
Elrod Posted July 29, 2017 Report Share Posted July 29, 2017 There may be a pain and suffering clause in policy. 1 Quote Link to comment Share on other sites More sharing options...
Catherine Posted July 31, 2017 Report Share Posted July 31, 2017 If not, I want to know what insurance company will over-pay on a claim! (Their rates should be outrageous, or they'll go under. Pick one - maybe both.) 1 Quote Link to comment Share on other sites More sharing options...
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