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ixr02443
Level 1
Feb 29, 2020 9:23 PM UTC
Solved

taxes

My question is if I win money from a settlement, will I have to report it?  It would be considered a 998.  It would stem from a settlement case for lemon car law where my car was defective & Volkswagen decided to settle.  Will I have to report the money I win?

    DeanM15Answer
    Alumni - Intuit
    Feb 29, 2020 9:47 PM UTC

    It would depend on what the settlement was for.

     

    All punitive damages are taxable except in certain wrongful death actions. If you had an accident, compensatory damages are not taxable. Generally, if the settlement replaced something that was taxable income, then it is taxable. If it replaces something that is not taxable then it is not taxable.  

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    DeanM15Answer
    Alumni - Intuit
    Feb 29, 2020 9:47 PM UTC

    It would depend on what the settlement was for.

     

    All punitive damages are taxable except in certain wrongful death actions. If you had an accident, compensatory damages are not taxable. Generally, if the settlement replaced something that was taxable income, then it is taxable. If it replaces something that is not taxable then it is not taxable.  

    **Say "Thanks" by clicking the thumb icon in a post. **Mark the post that answers your question by clicking on "Mark as Best Answer"
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