Will My Personal Injury Settlement Be Taxable?
If you file a lawsuit for a personal injury caused by someone else, the settlement you receive typically won’t be taxable by the government. Your nontaxable settlement funds include compensation for both your economic and non-economic damages. Although this general rule applies to most personal injury claims in Florida, there are some exceptions to the rule you should be aware of.
If you need help assessing whether your settlement is taxable, you can seek advice from a West Palm Beach personal injury lawyer from The Law Offices of Casey D. Shomo. Our team can also help you win the maximum settlement amount possible if you’ve been injured and want to take legal action.
Taxable Exceptions for Personal Injury Claims
There are a few taxable exceptions you should know regarding personal injury claims in Florida. If you win punitive damages in your claim, these damages will be taxable even though the rest of your settlement is nontaxable.
If your personal injury resulted from a breach of contract, then your entire settlement may be taxable.
You’ll also be taxed on the interest of your judgment. For example, if you receive interest on your settlement for the length of time that your case is pending you must pay taxes on the interest you receive.
Lastly, you may have to pay taxes on a settlement won for an emotional injury claim because nontaxable settlements only apply to physical injury claims.
Consult a Personal Injury Attorney
Taxes in personal injury claims may get confusing if your claim takes a long time to settle and has many moving parts. A personal injury lawyer can ensure that you pay the government only what you need to pay and keep the rest that you deserve. To schedule a free consultation with our Florida team at The Law Offices of Casey D. Shomo, fill out the contact form below or call 561-659-6366.