If you are injured on the job and receive workers’ comp benefits, wage replacement, or a settlement, you may wonder about paying taxes—isn’t that income?
When you suffer a work-related injury or illness, the workers’ comp insurance carried by your employer gives you access to medical care and other benefits. If you suffer a serious injury, or are partially disabled, you may also be eligible for a cash settlement.
When you are awarded wage replacement or other cash benefit, your workers’ comp may be a primary source of income. Despite that, workers’ compensation proceeds are not considered taxable income.