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I am not an expert - but - for what it is worth, I would have thought they were not taxable, as they are not really earnings - they are payment to you to compensate for harm done to you.....however it is best to contact a tax expert or an accountant to advise you properly.


IMPROVE: It would also depend upon the state where you live, and if punitive damages were awarded. Typically, you are not taxed on compensatory damage awards, but you are on punitive damages (loss of consortium, mental anguish, etc.) that are awarded in addition to any compensatory damages awarded.

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15y ago

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