Actual damages that are to replace the cost of the car are not taxable. That is just a reimbursement. But the additional amount over and above that MAY be taxable. It depends on what it is for. If it is the result of physical injury then it is not taxable. If it was punitive then it is taxable. You can't deduct attorney's fees from your settlement.
Here is an article on the types of legal settlements that are taxable.
And here's an article on deducting legal fees.
@yo2025
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