On a sexural harassement settlement do you pay taxes?

You pay taxes on any kind of settlement. The government taxes your money regardless of how you got your money. One man went to jail because he did not pay taxes for dealing drugs, and another for embezzlement. The government wants you to pay taxes regardless of how you got your money.

The above rather extreme comment is not surprisingly, incorrect in many many ways. Theure are many, many ways to receive many and for it not to be taxable.

The type of loss causing the settlement may well drive whether the money from it is taxable. for example, if you settle for damages received to your property (somebody hit your car), or even to you, (you lost any eye because someone through a firecracker), that mony is only to restore you to the position you were in and is NOT taxable. (Similar to had you sold the car).

On the other hand, if your getting paid because of the loss of income from not having the use of the car and you lost income (same with sight), that income, which would have been taxable when made, is more than likely taxable when received as a settlement. Hence, the terms used and structure of the settlement agreement are very important and something the lawyer involved should consider.