I have received a settlement from a class action suit against the city of Chicago. The defendant allegedly violated my constitutional rights. Is this settlement compensation taxable?
Asked on 2/07/13, 11:43 am
1 Answer from Attorneys
Virginia Prihoda
Law Offices of Virginia Prihoda
Probably. Income is taxable unless there is a specific provision of the law excluding the income from taxation. Legal damages are generally taxable unless the damages relate to a physical injury. Sounds like this is a situation you may need to review with a professional tax preparer
Answered on 2/07/13, 12:01 pm
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