Received a settlement for an auto accident. Bodily injury. It's over and above expenses. Don't know what category to call it so I temporarily assigned it to "Unallocated". Can someone give me a suggestion please? This isn't tied to a business transaction in any way.
If this is strictly for your own records (ie: not tied to any taxable category), why not simply use "Miscellaneous Income"? Hopefully, you'll never have another incoming check for another problem that might suggest establish a *real* category for it.
There's no RULEs about what you can establish in Q's categories - it's strictly what you use them for, so do whatever fits your situation the best!
"John Gregory" wrote
(snip)
I use a category called "Legal Settlements". I have another called "Insurance Settlements", although one category that includes both types of settlements would help KISS for most users.
There are some posters here who would use a medical expense category since that's what the money was (supposed to be) used for. This method works for many, although I personally like to separate the income and expense categories, even though some may not consider this to be *income*.
It is unclear to me by your wording if this is a taxable event. Compensatory damages for personal physical injury are not taxable (even if part is for emotional distress, as long as the emotional distress was due to physical injury). Punitive damages are taxable whether or not awarded for a physical injury. Consult a tax adviser and/or IRS Pub 525.
If "pain and suffering" compensation isn't taxable, I'm prone to leave the entry where it is; unallocated income. That's a close enough description - which I can round out with a few more key words. Since this is the first in
63 years, there's a fair chance I won't have another in my lifetime. I do plan on riding a bike when I feel my reflexes aren't quick enough to "protect" me and others from my actions as a driver. Wish the other guy had the common sense to have done so. I wouldn't be asking where to post his money right now.I appreciate the advice. I'll assume this is a none taxable event and dig into the clarification later. Thanks.
BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.