One question you may regularly have regarding your maritime injury and which our maritime attorneys get regularly is if your maritime settlement is taxable? The answer is generally no.
The IRS Code Section 104 states that any money you receive on account of a maritime personal injury is not considered income to you that year, as follows:
“Section 104(a)(3) states that except in the case of amounts attributable to (and not in excess of) deductions allowed under ‘ 213 for any prior taxable year, gross income does not include amounts received through accident or health insurance (or through an arrangement having the effect of accident or health insurance) for personal injuries or sickness (other than amounts received by an employee to the extent such amounts are attributable to contributions by the employer which were not includible in the gross income of the employee or are paid by the employer).”
If you make a claim for a maritime injury and your maritime injury claim settles, the money is likely not going to be taxable to you. However, an experienced maritime lawyer knows it would be preferable to specifically delineate that all monies paid in your maritime injury settlement were paid for your personal injuries. Our maritime attorneys always protect our clients by making sure that this language is in their settlement documents.
If you’re injured on the water or suffer an offshore maritime injury and receive a Jones Act settlement, take care to make sure you talk to your maritime attorney about this. He or she should know this type of information. Call us if you have any questions about whether the money you may get through the Jones Act due to a maritime injury or offshore injury is going to be taxable to you. Our maritime attorneys are here and ready to represent you in your injury claim.