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New Member
posted Jun 4, 2019 4:31:03 PM

My car was damaged on the freeway from road construction. I won the settlement. Will I be taxed on the settlement?

My vehicle was damaged by debris left on the road from construction. I won the settlement for the damages done to my vehicle is the money I won something I will be taxed on? 

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2 Replies
Level 15
Jun 4, 2019 4:31:04 PM

It depends on what is covered by the settlement.

Recoveries for damages to property is generally not taxable.  But if you were already paid by your insurance company, you may have to pay them back.  If you don't pay back the insurance company, then you have recovered twice for the same loss, and that might make it taxable, I would have to do some research.

If part of the settlement covers lost wages, pain and suffering, or punitive damages, that is taxable.

New Member
Jun 4, 2019 4:31:06 PM

I did not go through insurance I contacted the company directly and they settled so I could get my vehicle fixed.