Sexual Harassment Damages | How to Mitigate the Tax
What Did the 2017 Tax Cut and Jobs Act Do?
In December 2017, the Tax Cuts and Jobs Act was passed, which eliminated the tax deduction for confidential sexual harassment settlements and payments related to sexual abuse or harassment that are subject to nondisclosure agreements. However, the law did not change the tax treatment of these settlements and payments for the recipients.
Generally, compensation received as a result of physical injuries or sickness is not taxable, and this includes settlements and awards related to sexual assault or sexual abuse that result in physical injuries or sickness. However, if a portion of the settlement or award is for emotional distress or mental anguish and is not related to physical injuries or sickness, that portion may be taxable.
For those with taxable damages, or with an element of taxable damages, agreeing to a non qualified structured settlement offers significant advantages.
Earn interest tax deferred
Earn in interest on the deferred taxes tax deferred
Earn interest on the interest tax deferred.
What is a Structured Settlement?
4structures.com LLC works with male, female and non binary victims. For our Statement on Diversity and Inclusion please click here
