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Bill
Bill, Enrolled Agent
Category: Tax
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Experience:  EA, CEBS - 35 years experience providing financial advice
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i am about to receive a settlement in a wrongful death case,

Resolved Question:

i am about to receive a settlement in a wrongful death case, this involves myself and my 3 children. will i be taxed on the proceeds
Submitted: 8 years ago.
Category: Tax
Expert:  Bill replied 8 years ago.

Wrongful death proceeds as a result of physical injuries are tax-free. However, if there was any interest earned on the proceeds that will be paid to you then those amounts are taxable.

 

http://www.bankrate.com/brm/itax/tax_adviser/20061229_wrongful_death_settlement_a1.asp

 

http://www.irs.gov/pub/irs-pdf/p4345.pdf

 

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