Do You Have to Pay Taxes on Personal Injury Settlements?

Do You Have to Pay Taxes on Personal Injury Settlements?

There are exceptions to every rule.


Taxes on Personal Injury Settlements

After settling a personal injury case, you may be asking, "Do I have to pay taxes on my personal injury settlement?" The answer is: it depends. 

Taxable settlements are dependent on what type of compensation a claimant pursues in the first place. The following circumstances are when you may need to pay taxes on a personal injury settlement:

  • You secure financial compensation for lost wages
  • You recover noneconomic damages for emotional distress
  • You secure punitive damages
  • There was interest in the judgement; interest on the verdict is taxable

If you have additional questions related to your unique case, schedule a free consultation with a personal injury lawyer to learn more. 


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