This is considered non-taxable compensation for “pain and suffering” similar to that of being compensated for personal injury car accident claims. No, you do not usually have to claim this as income unless you 1) want to for financial income reporting purposes or 2) need to for requirements in your state. In those cases you’d want to file as self employment income and yes, you’d need to pay taxes on it in order to do that. This is not generally recommended since you won’t be a regular “surrogate” as self employment would imply. There are considerable risks to pregnancy as a surrogate which is why it is considered a pain and suffering reimbursement.
