How are personal injury settlements paid out?

After you reach a settlement you'll want to know how personal injury settlements are paid out. There are five main steps you'll need to go through from signing the release to figuring out the tax implications of your settlement. At the federal level, pain and suffering payments are not taxed but any lost wages included in the settlement could be subject to income taxes. States vary on how they tax settlements, so be sure to discuss these matters before accepting any settlement offer.

UPDATED: Jul 13, 2023Fact Checked

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption

Maurice Davis

Personal Injury Attorney

Maurice Davis is a personal injury attorney and the founder of Davis Injury Lawyers, PLLC, in Detroit, Michigan. He combines his compassion with his years of legal experience to help people hurt by another party’s negligence get the justice they deserve — a mission that drives him and his team. With a degree in political science from Michigan State University and a J.D. from Florida State U...

Personal Injury Attorney

UPDATED: Jul 13, 2023

Advertiser Disclosure

It’s all about you. We want to help you make the right legal decisions.

We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes and legal advice should be easy. This doesn’t influence our content. Our opinions are our own.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about legal topics and insurance. Our goal is to be an objective, third-party resource for everything legal and insurance related. We update our site regularly, and all content is reviewed by experts.

UPDATED: Jul 13, 2023

Advertiser Disclosure

It’s all about you. We want to help you make the right legal decisions.

We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes and legal advice should be easy. This doesn’t influence our content. Our opinions are our own.

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption