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Below is a list of the most common customer questions. If you can’t find an answer to your question, please don’t hesitate to reach out to us.
There are four basic types of conclusion you can use, summed up by the letters PRS: Predict, Quote, Repeat or Summarize. There are two main ways you can use predictions. If your report is about a decision already taken, you can use the ending to sum up the effects you expect to see.
If you receive a settlement for personal physical injuries or physical sickness and did not take an itemized deduction for medical expenses related to the injury or sickness in prior years, the full amount is non-taxable. Do not include the settlement proceeds in your income.
Think legal settlements for auto accidents and slip and fall injuries. Because such payments for compensatory damages are generally tax-free to the injured person, no Form 1099 is required.
Taxes on Lawsuit Settlements. The tax liability for recipients of lawsuit settlements depends on the type of settlement. In general, damages from a physical injury are not considered taxable income. However, if you've already deducted, say, your medical expenses from your injury, your damages will be taxable.
Your insurance claim income is probably not taxable. However, insurance claim taxable income might be an issue, and you must include the reimbursement as income if either of these is true: You reported the resulting medical expenses as itemized deductions in a prior year.
Taxes depend on the origin of the claim. Taxes are based on the origin of your claim. Recoveries for physical injuries and physical sickness are tax-free, but symptoms of emotional distress are not physical. Allocating damages can save taxes. Attorney fees are a tax trap.
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