Class action lawsuit

[btlfostee]

I am involved in a class action lawsuit involving pharmaceutical companies. These pharmaceutical companies were not forthcoming with the side effects of their products and my husband ended up with kidney failure and as a result died. Is this something I have to claim on taxes cause my fear is if I do, my minor child, would lose his survivor benefits through social security due to the money for the lawsuit being income received. 

[Mike9241]

impossible to say at this juncture because, assuming plaintiffs win, it's going to depend on what the settlement is for. in many cases, there is no breakout between taxable and nontaxable portions.  From what I've read about other settlements it's unlikely that the attorneys handling the case for plaintiffs will give a tax opinion.

taxable

• an award or settlement that replaces taxable income 
• interest on the settlement
• damages that are not for personal injury
• reimbursement of medical expenses that were deducted in earlier years to the extent of their tax benefit
• punitive damages other than for wrongful death 

nontaxable

• damages for personal injury or sickness including emotional distress
• property damage to the extent it does not exceed the property's basis
• refunds to the extent the expense was not deducted or produced no tax benefit
• damages received for emotional distress
• reimbursement of medical expenses where there was no tax benefit 
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