Aleta sued Boboy for breach of promise to marry. Boboy lost the case and duly paid the court's award that included, among others, Pl00,000 as moral…

The question

Aleta sued Boboy for breach of promise to marry. Boboy lost the case and duly paid the court's award that included, among others, Pl00,000 as moral damages for the mental anguish Aleta suffered. Did Aleta earn a taxable income? (2013 Bar Question)

1. A.She had a taxable income of P100,000 since income is income from whatever source.
2. B.She had no taxable income because it was a donation.
3. C.She had taxable income since she made a profit.
4. D.She had no taxable income since moral damages are compensatory.

This question has not been answered yet.