Do I have to pay taxes on the emotional disterss portion of my out of court settlement?

I was terminated after returning from FMLA leave for treatment of Hepatitis C and informed my employer the treatment did not work. I was harassed and blamed for my position falling apart due to my illness and taking a leave. When I filed an investigation into the treatment, I was fired the same day. I filed a suit and settled out of court. I received one check for attorneys fees, one check for lost wages with taxes deducted, and one check for the emotional distress. Thank you.

1 answer  |  asked Jan 29, 2012 8:38 PM [EST]  |  applies to Iowa

Answers (1)

Roxanne Conlin
Yes you do have to pay taxes. You should get a 1099 from your former employer but even if you dont you must report the amount as income. R

posted by Roxanne Conlin  |  Jan 29, 2012 9:38 PM [EST]

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