In general, the items that are included in a taxpayer's federal gross income include:
- Prizes and awards: These are typically taxable and must be included in gross income, unless specifically excluded by law.
The other items listed are generally not included in gross income:
- Gifts and inheritances: These are not included in gross income for federal tax purposes.
- Life insurance payments, if paid by reason of the death of the insured: These are also generally excluded from gross income.
- Meals and lodging provided for the convenience of the employer: These may not be included in gross income under certain conditions, such as when they are provided for the benefit of the employer and not the employee's choice.
Therefore, the correct answer is prizes and awards.