Is the Settlement my Atlanta Injury Lawyer Obtains for Me Taxable?
Assume that we tried or settled your Atlanta car accident Injury case and now you are trying to determine what your actual recovery will be. Many of my clients call and ask, what will I have to pay in taxes? The answer is, probably nothing. Compensation for pain and injuries is not gross income under the tax code. Generally speaking, unless you received money for punitive damages in Georgia or lost wages, there is no tax on the money recovered.
Under Federal Treasury Regulation § 104(a)(2) Gross Income:
“Section 104(a)(2) excludes from gross income the amount of any damages received (whether by suit or agreement) on account of personal injuries or sickness. The term “damages received (whether by suit or agreement)” means an amount received (other than workmen’s compensation) through prosecution of a legal suit or action based upon tort or tort type rights, or through a settlement agreement entered into in lieu of such prosecution.”
If you have any further questions for this Atlanta Injury Lawyer, please give me a call.
