Workers comp

[TAX]

Client received worker's comp settlement of $100,000 in a court judgment

(1) I think this comp is not taxable but....

(2) Client incurred medical expenses while waiting for this judgment. Can he deduct these medical expenses on his tax return.

Thanks!

[taxea]

Workers comp

As your client for detail record of the settlement...portion that was for salary must be reported...if medical expenses were reimbursed as part of the settlement they are not deductible. The rest depends on the detail. taxea

[jainen]

non-taxable, period

>>portion that was for salary must be reported<<

Workers Compensation is non-taxable, period. Medical expenses are always deductible in the ordinary way, regardless of the source of funds used to pay them.

[skhyatt]

Workers comp for injuries or sickness are exlcuded from employees or survivors income, but included in income if attributable to medical expense deductions taken in an earlier year.

[Gretel]

OK Jainen, I agree with Skyhatt. Do you have any authority to back your position? It would be great.

[jainen]

A gentleman

>>Do you have any authority to back your position?<<

A gentleman may express his opinion. When it comes to a challenge, a gentleman will of course allow the lady to strike the first blow.

[Gretel]

A gentleman may express his opinion. When it comes to a challenge, a gentleman will of course allow the lady to strike the first blow.

I better watch out now.