Very interesting post, might I say. We all know the broad stipulations on what constitutes a "physical injury". Normally those that produce an "observible bodily harm" are considered tax free. What are the tax obligations for someone who expieriences sexual harassment and recieves no bodily harm? What if a bodily harm did occur but no documented evidence? From my understanting a Discrimination case (typical of sexual harassment) occuring in a work enviornment is taxable on account of non-physical injury. I may be wrong, as there is absolutely no definitate stance the IRS takes on account of these said issues (undoubtedly frustrating).