Structured Settlement Insurance

as long as the settlement is to cover your losses from damage or medical bills, no. –These reduce your casualty loss amount and possible deduction on Schedule A. BUT, if you deducted your costs as a casualty loss in prior years and got a tax reduction for them, then the settlement is taxable.

to the extent it is lost wages, yes.

for other cases, see IRS regulations — search irs.gov for the appropriate publication

Usually the lawyers will withhold the taxes and medical before you get the check. That is the norm. Otherwise you will receive a form 1099 for other income that might be taxed. It is usually not considered income. If it is you get to take off your expenses to reduce the amount being taxed. Gail Seymour 580-762-7458