Good morning (irish.......) When you file your taxes this money will be added to your regular income. You will then use the basic or itemized filing to determine your taxes. Once all of your allowable deductions are subtracted you will have what is know as the "adjusted gross income."(AGL) Where this falls in the "tax tables" indicates the amount of taxes you will be paying. If you would like an "advance look" or "estimate" you could go to your last years filing and add the settlement to what you ended up with last year. If your deductible expenses and income were fairly close to what this year's will be the answer in the tax tables will be fairly accurate.
Dennis (cut2it)
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NCP
Investment R.E. Broker 30 yrs. & past owner of Mortgage Brokerage Company.