Government Settlements And Taxation

Sonny Clark

Diamond Member
Dec 12, 2014
51,089
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Gadsden Alabama
If a person sues a local, state, or the federal government, wins the law suit, and is awarded a cash settlement, should the settlement be taxed? If a person is awarded $10 Million from the government, and is forced to pay taxes on the $10 Million, did the government actually pay $10 Million in damages?

If yes, why?
If no, why?
 

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