In California, is a settlement for Workers Compensation considered taxable or non-taxable income?

Asked over 1 year ago - Los Angeles, CA

I received temporary disability payments for about 2 years under Workers Compensation Insurance for California. I then received a final one lump payment of 24,000 as a settlement.

Attorney answers (2)

  1. Brad S Kane

    Pro

    Contributor Level 18

    1

    Lawyer agrees

    Answered . The only portion that would not be personal income money specifically allocated to personal injuries. The portion allocated to lost past or future income will be considered wages for tax purposes.

  2. George Ellis Corson IV

    Contributor Level 20

    1

    Lawyer agrees

    Answered . Your only real tax concern is allegations of 132a Discrimination within your claim, because back/future non-TTD wages are involved. If 132a Discrimination was not alleged/settled/dismissed, the rest is tax-free.

    We offer general concepts, but you should give ALL your facts to a licensed Attorney in your state before you RELY... more

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