T
TaxHombre
a client of mine received a $25K payment from his former
employer. the nature of his claims were as follows: "[the
plaintiff proposes to bring claim against the defendant in a
court of law, seeking] settlement of claims for lost salary
and other compensation, emotional distress, punitive
damages, attorneys' fees, costs and interests. In lieu of
this claim, the plaintiff demands payment] for a portion of
lost salary and other compensation, and other damages."
since some of the claim was for lost salary, and some for
emotional distress and punitive damages, is it possible that
some of the settlement is free of income tax?
i've never run into this situation before, and i welcome
your comments.
thanks,
peter desmond
employer. the nature of his claims were as follows: "[the
plaintiff proposes to bring claim against the defendant in a
court of law, seeking] settlement of claims for lost salary
and other compensation, emotional distress, punitive
damages, attorneys' fees, costs and interests. In lieu of
this claim, the plaintiff demands payment] for a portion of
lost salary and other compensation, and other damages."
since some of the claim was for lost salary, and some for
emotional distress and punitive damages, is it possible that
some of the settlement is free of income tax?
i've never run into this situation before, and i welcome
your comments.
thanks,
peter desmond