Do I have to pay taxes on my share of a personal injury settlement?

A: This is a question I am asked almost every time I hand a client a settlement check at the conclusion of their case. The simple answer is no, you do not have to pay taxes on your portion of a personal injury settlement. There are exceptions when a lost wage claim is so large that it represents the great majority of the overall claim, such as cases resulting in permanent disability or death where years of future earnings are claimed as lost wages. But in approximately 99% of personal injury claims, especially claims arising from car and trucking accidents, there are no tax ramifications.

by Earl K. Straight earlstraight@straightlaw.net

Austin Personal Injury Attorney