Will I Have to Pay Taxes on My Personal Injury Settlement?

Posted in Personal Injury on June 23, 2020

When you’re hurt in a serious South Carolina accident, you’re probably worried about getting the maximum settlement for your claim. You shouldn’t have to pay out of pocket for something the careless at-fault party did, right? 

But getting fairly compensated is only part of your concerns. You also need to know whether you’ll have to pay taxes on your personal injury settlement.

Your personal injury lawyer can help you determine the compensation you’re owed and give you an idea of what kind of tax burden you should expect once you’ve been compensated.

Your South Carolina Settlement May Be Tax-Exempt

When you’re hurt in an accident, the compensation you receive should cover the costs of your losses, which you wouldn’t have suffered if the at-fault party had done their duty to be careful. 

That money is meant to make up for something that was, in essence, taken from you by someone else’s negligence. So why should you have to pay taxes on it? At the federal level, you don’t.