Auto and personal injury claim
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Auto and personal injury claim

My wife and I were in an auto accident and we were awarded a auto claim to replace the loss of our vehicle. Later she was awarded a personal injury claim from the insurance company who's insured was at fault. Does the money from the auto claim and personal injury claim count as income? From what I've been reading it doesn't. Thanks
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Auto and personal injury claim

If the settlement was for personal physical injuries or physical sickness and you didn't take an itemized deduction for medical expenses related to the injury or sickness in prior years, the full amount is non-taxable. For more information about these type of settlements, please view IRS Publication 4345 below.

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

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