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Will I have to pay taxes on medical malpractice settlement?

  
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Will I have to pay taxes on medical malpractice settlement?

Postby doran » Fri Apr 01, 2011 12:38 pm

I won a settlement from a medical malpractice claim where I was not given anestheisa or pain medicine for an emergency c-section. Does this count as physical injury or sickness in order to be exempt from paying taxes?
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Will I have to pay taxes on medical malpractice settlement?

Postby dalon » Fri Apr 01, 2011 12:43 pm

Compensatory damages are not taxable, but punitive damages are. If a portion of the damage award was punitive, then that portion should be reported as income.
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Will I have to pay taxes on medical malpractice settlement?

Postby delron » Fri Apr 01, 2011 12:46 pm

No, Insurance proceeds are never taxable unless there are some specific reasons. You should not receive any forms regarding the income.
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