Do I need to pay taxes on money received from part of an insurance claim? 12 Answers as of March 17, 2013

I received lost wages compensation from an injury claim and would like to know if I need to pay federal tax on the amount, I have received. Thank you.

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Law Offices of Sandeep G. Agarwal
Law Offices of Sandeep G. Agarwal | Sandeep G. Agarwal
You need to talk to an accountant about that question. That is not a legal question.
Answer Applies to: California
Replied: 3/17/2013
Law Offices of Ronald A. Steinberg & Associates | Ronald A. Steinberg, BA, MA, JD
Ask your accountant.
Answer Applies to: Michigan
Replied: 3/17/2013
Kram & Wooster, P.S. | Richard H. Wooster
If the payment was from an injury, it is not taxable. However, you should discuss it with your accountant. Sometimes the award also included punitive damages, which are taxable.
Answer Applies to: Washington
Replied: 3/15/2013
Wayne J. Wimer, Inc. P.S.
Wayne J. Wimer, Inc. P.S. | Wayne J. Wimer
If the money received was clearly designated for lost wages, it would be taxable. If you received an undifferentiated payment of X$ in settlement of all claims, the rule may be otherwise.
Answer Applies to: Washington
Replied: 3/15/2013
James E. Hasser, Jr. P.C.
James E. Hasser, Jr. P.C. | Jim Hasser
If it was compensation, it's not taxable. If for an accident, like a car wreck, it probably is taxable, but I'm not a tax lawyer and can't tell you for sure. Ask your accountant to be sure.
Answer Applies to: Alabama
Replied: 3/15/2013
    Paul Whitfield and Associates P.A.
    Paul Whitfield and Associates P.A. | Paul L. Whitfield
    The general rule is that personal injury money is not taxable but that wages are. See your accountant or CPA to get definitive answer but wages I think yes.
    Answer Applies to: North Carolina
    Replied: 3/15/2013
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