Do you have to pay taxes on a workmen's compensation settlement?
It is my understanding that monies collected in any form which are not specifically exempted from tax status are considered income, and taxable. To verify this, the best route to take would be to contact the local office of the I.R.S. for confirmation of the state, local, and federal requirements... The answers should be readily available without obligation, as they are a matter of record. WCI settlements/benefits generally do not qualify as taxable income as long as they are paid under the state's act or statute governing WCI for the occupational sickness or injury to a worker or death benefits to family survivor(s). WCI benefits are taxable if they are offset by SS or RRB benefits.