legal  money  taxes


Question by  kljacf (19)

Are malpractice insurance awards subject to federal income taxes?


Answer by  mpartin (1600)

Any monies awarded to you are considered taxable income. In some instances, a family member may be able to give you money as a gift and it not be taxed. Best to contact an attorney.


Answer by  MarkWatrous (729)

Yes, damages are considered taxable income according to IRCĀ§ 61(a) unless that award was for PHYSICAL damage caused to you. If the damage award is for mental or emotional pain, you award will be taxable. Look for a 1099-MISC, and pay close attention to Box 3!

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