If I was rear-ended in an automobile accident and the other person's insurance paid for the damages to my vehicle. How much, if any, of that money has to be claimed on my income taxes for 2013?

ANSWER

The BIDaWIZ Team's Answer:

This will most likely not be a taxable event reported on your return. Insurance settlements for the damaged vehicle are not taxable income unless the payment exceeds your cost in the damaged property. This is highly unlikely though as vehicles depreciate over time. However, if you do in fact receive more than the cost of the car, an involuntary gain is reported on your form 1040.