No Fee Unless We Win
(215) 866-2424

Understanding Medical Malpractice Lawsuit Awards: Are They Taxable?

by The Beasley Firm  |  September 14, 2018  |  

The damages awarded to individuals harmed as a result of medical malpractice are very helpful when it comes to affording medical expenses and dealing with lost wages. There are other damages such as non-economic and punitive.

"TAX" written on blocks

While these awards are great, not many people are sure of whether or not they are taxable and what this means. Does it become part of income? Can you lose some of the money awarded? These are important things to know.

So, are medical malpractice awards taxable? It depends.

There are certain circumstances that must be considered and they determine whether or not you have to pay taxes on your award. Here are the things you should know about which damages may be considered taxable and which ones are tax-free.

  • Economic damages: These are the damages with direct monetary value that compensate you for the medical expenses associated with the injury sustained. These damages are not taxable income.
  • Non-economic damages: For emotional damages, the award is taxable unless it is directly connected to the physical injury or illness.
  • Punitive damages: These are considered additional awards that punish the defendant and because it’s on top of any compensation, it is considered taxable income.

If economic damages include replacement income, that must be included in the taxable income, as well as interest awarded as part of the lawsuit.

Regardless of whether or not the award is taxable, you deserve the right to seek compensation for the damages caused by a negligent medical professional. You should be able to hold the responsible party accountable financially.

Our Philadelphia medical malpractice attorneys at The Beasley Firm are committed to protecting your rights and we know how difficult this situation is. You deserve to seek compensation and if successful, you should know what is taxable and what is not.

We make it a point to explain your rights and options every step of the way so you have the peace of mind you deserve. Trust that we’re here for you.

Call us today to discuss your potential case.

Share This Story
If you found the information provided by this article useful, consider sharing to your social media channels to help others in their search for reliable personal injury resources.
Get in Touch with Our Team Today
Contact us today by filling out the form below
or call us at (215) 866-2424 to speak with an attorney today.

Over $2 Billion Won
for Our Clients
(215) 866-2424
Philadelphia Office
The Beasley Building
1125 Walnut Street
Philadelphia, PA 19107
Chester County Office
10 Lindbergh Boulevard
Coatesville, PA 19320
New Jersey Office
1949 Berlin Road
Suite 100
Cherry Hill, NJ 08003
Centre County Office
375 Trout Road
State College, PA 16801
Follow Us

The information on this website is for general information purposes only. Nothing on this site should be taken as legal advice for any individual case or situation. This information is not intended to create, and receipt or viewing does not constitute, an attorney-client relationship.

Created By:

magnifierchevron-down