Amounts you receive as workers' compensation for an occupational sickness or injury are fully exempt from tax if they are paid under a workers' compensation act or a statute in the nature of a workers' compensation act. The exemption also applies to your survivors. The exemption, however, does not apply to retirement plan benefits you receive based on your age, length of service, or prior contributions to the plan, even if you retired because of an occupational sickness or injury.
If part of your workers' compensation reduces your social security or equivalent railroad retirement benefits received, that part is considered social security (or equivalent railroad retirement) benefits and may be taxable. For a discussion of the tax ability of these benefits, see Other Income under Miscellaneous Income, later.
Go to IRS.gov and use the search box for Publication 525 (2009), Taxable and Nontaxable Income
NO workers compensation for an on the job injury is not qualified taxable earned income for the earned income credit.
Less
YES
No. The tax deduction will be on your federal income taxes instead.
income taxes ? no insurance payments are exempt
No you are not supposed to claim if you are in arrears.
Either
no
My child was in the Job Corps last year, can I still claim him on my federal income taxes as a dependant?
Yes, if you are required to purchase uniforms to wear for your job, such as scrubs, there is a deduction you can claim on your income tax forms.
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No, Allas.