No. A settlement for personal injury is not taxable.
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Personal injury settlements are usually not subject to federal income tax. However, if there is money paid for confidentiality this is taxable. There is a famous lawsuit involving basketball player, Dennis Rodman, that involved taxation related to confidentiality.
Samuel A. Coffey, Esq.
ABRAMOWITZ, POMERANTZ & COFFEY, P.A.
Belle Terre of Sunrise, Suite 101
7800 W. Oakland Park Boulevard
Sunrise, FL 33351
Phone: (954) 572-7200
Fax: (954) 748-6488
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Sam Coffey is licensed to practice law in Florida. This response 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. Coffey strongly advises the questioner to confer with an attorney in your state in order to ensure proper advice is received.
When you are compensated for injury, pain or suffering you have not EARNED anything, therefor it is not income, thus not a taxable event. It is merely an attempt to replace something that was taken from you.