Are mesothelioma settlements typically subject to income tax fees and requirements?

Answer by  AnnaTeague (806)

Generally, the portion of the mesethelioma settlement which represents lost wages may well be subject to taxation; however, the personal injury and pain and suffering portions are not taxable.

Answer by  John48912 (86)

There are allowable deductions (legal and medical costs, for example) that may reduce tax liability; ideally, there would be statements and receipts to prove these costs. As to state income tax, that will vary with the jurisdiction. It is possible to structure a settlement to lessen any tax costs or liability.

Answer by  Jerry47 (18)

No, because Most states and the IRS understand that when you receive a mesothelioma settlement, that money isn't income, it's compensation for things you lost, like your health or job.

Answer by  Dean (4035)

For the purposes of taxes, settlements are classified into two groups: those for physical injury and those for non-physical injury. Each of those is classified as either punitive, emotional or actual damages. Generally, awards for physical injury/distress due to physical injury/accidental death are not taxed.