Do you have to pay taxes on a personal injury settlement from a auto accident?

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1033574

2026-07-25 14:16

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Generally speaking you do not have to pay taxes on personal injury settlements. However, in certain situations where (1) all or part of the proceeds of the settlement is treated as disability income, and (2) the premium of the policy (under which the proceeds were paid) was paid by an employer; then that part of the proceeds will be treated as a taxable ordinary income.

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