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Do you have to claim your settlement on your tax returns for a car accident

Sacramento, CA |

I recieved a settlement for my car accident and my lawyer told me that I did not have to claim it

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Attorney answers 3


Your former attorney is correct, assuming that your recovery arose out of some sort of trauma that you received in the accident.

Legal Disclaimer:

Mr. Lundeen is licensed to practice law in Florida and Vermont. The response herein is not legal advice and does not create an attorney/client relationship. The response is in the form of legal education and is intended to provide general information about the matter within the question. Oftentimes the question does not include significant and important facts and timelines that, if known, could significantly change the reply and make it unsuitable. Mr. Lundeen strongly advises the questioner to confer with an attorney in your state in order to insure proper advice is received.


No. Personal injury settlements are non taxable.

There have been efforts over the years to change this particular part of the IRS tax code [on both sides of the "aisle"], but as of this posting, no, this is not taxable income.

This answer is provided for informational purposes only. Actual legal advice can only be provided in an office consultation by an attorney licensed in your jurisdiction, with experience in the area of law in which your concern lies.


It is not taxable.

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