Dear sir or ma'am,
I am a Monroe County, NY, resident and was injured at work on 18 May 2009. I had surgery performed on my left shoulder on, or about, August 2009, as a result of that injury. I collected workman's compensation from that date till 23 November 2009, after completing several months of physical therapy and several follow up visits with my surgeon. I was then, medically, cleared to return to work, and received all weekly payments, for that time.
On 27 August 2010, I received a phone call from my, workman's comp insurance
carrier, case manager, also based in NY state, at which time I was offered a $20,000 settlement.
My question is;
Is this $20,000 proposed settlement subject to local, NY state, and federal taxes? I was under the impression, that because this settlement did not include any wages, (lost, backdated, or other), that the settlement was tax free.
Is this accurate?