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Workmen's compensation benefits are not taxable for income tax purposes.
I have no idea what your tax person could be talking about when you say "my tax person says I have to pay on it through my property taxes"?
The only possibility that comes to mind is if you are receiving some type of reduction of your property taxes based upon your limited income & the workmen's compensation benefit is considered one of your income resources even though it isn't taxable for income tax purposes.
Those programs generally consider all of your income, taxable or not, social security, capital gains, etc.
If you need to contact me again with any tax or financial questions, you can just ask for "Steve G" at the beginning of your question. Again, please remember to rate my response. Bonuses, where you think they are warranted, and excellent ratings, are always most appreciated. Thanks again for using JustAnswer.com.You may get a short survey from the site; if it isn't too much trouble I would appreciate it if you would answer it; the survey results are used to rate our performance;