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#1
04-18-2005, 03:53 PM
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 Re: payments from legal settlements "Bill Brown" <brownwp[at]longwood.edu> wrote: - quote - > lamp...[at]msn.com wrote: > > How are payments from legal settlements (such as payments > > from drug company litigation settlements and other similar > > payments) viewed in terms of tax liability? If considered > > income, what category would it be listed under? Is the > > payer required to file any forms or notify the payee of tax > > liability? > Settlement payments for physical injury or illness or to > reimuburse otherwise deductible costs (such as medical > expenses)or fully taxable. Those amounts are reported on > Form 1040, line 21 (Other income). > Since when? Settlement amounts on account of physical pain, suffering, medical etc. are specifically listed as NOT taxable. -- David M. Woods, EA, ChFC, CLU Woods Financial Services Norwood, MA 02062 www.woods-financial.com << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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04-16-2005, 04:12 PM
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| Re: payments from legal settlements lamp...[at]msn.com wrote: - quote - > How are payments from legal settlements (such as payments
Settlement payments for physical injury or illness or to> from drug company litigation settlements and other similar > payments) viewed in terms of tax liability? If considered > income, what category would it be listed under? Is the > payer required to file any forms or notify the payee of tax > liability? reimuburse otherwise deductible costs (such as medical expenses)or fully taxable. Those amounts are reported on Form 1040, line 21 (Other income). The payor should issue a 1099MISC. Most do that without regret since the generally want the person who got their money to pay taxes on it. Regards, Bill << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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#-1
04-15-2005, 11:44 PM
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| payments from legal settlements How are payments from legal settlements (such as payments from drug company litigation settlements and other similar payments) viewed in terms of tax liability? If considered income, what category would it be listed under? Is the payer required to file any forms or notify the payee of tax liability? << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
| Tags |
| legal, payments, settlements |
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