Do You Have to Pay Taxes on Roundup Settlement Checks
Researchers across the country have linked the weed killer Roundup to Non-Hodgkins lymphoma and other cancers. People who have suffered from these illnesses as a result of Roundup exposure have recovered compensation for their losses. A question many people have about these settlements is if they have to pay taxes on the Roundup settlement checks. Fortunately, the answer is no.
The compensation people recover through Roundup settlements is called compensatory damages, and these damages are usually not taxable. Therefore, anyone who received a settlement check gets to keep their money without worrying about paying taxes. There are some exceptions to this, though. It is helpful to seek legal advice from an attorney to learn more about the exceptions.
Exceptions to Taxing Compensatory Damages
Most compensatory damages people can recover through a claim or lawsuit are not taxable. However, there are some exceptions.
According to the Internal Revenue Service (IRS), all income is taxable regardless of the source it came from. Therefore, if a plaintiff recovers compensation for lost or future lost income, that money could be taxed. Otherwise, most of the other damages someone could recover are safe from taxation.
Damages Someone Could Recover Through a Roundup Settlement Check
The goal of filing a claim or lawsuit against the manufacturers of Roundup is to recover compensation for developing non-Hodgkins lymphoma or another illness. These resulting diseases could call for someone to go through extensive treatments, leading to high medical bills and missed work. Not to mention, these financial hardships can take a mental and emotional toll on the patient.
No one should have to work through the process of recovering compensation in these compromised states alone. A product liability lawyer can pursue the costs of the following damages while they recuperate:
Past and Future Medical Treatment Bills
According to Mayo Clinic, non-Hodgkin’s lymphoma is a type of cancer that could require someone to undergo chemotherapy treatments. These treatments can cost a patient a lot out-of-pocket or increase their medical insurance premiums. Therefore, it’s crucial for someone who develops this disease to seek compensation to avoid having to suffer financially.
Other treatments for non-Hodgkin’s lymphoma could include:
- Targeted drug therapy
- Radiation therapy
Each of these treatments could require the patient to stay in the hospital for a long time. On top of these treatments, someone could have to pay for doctor’s appointments, prescription medications, over-the-counter medications, and diagnostic tests. By having to deal with all of these medical procedures, the patient may accumulate medical bills they have to cover.
Generally, the compensation a victim could recover through medical treatments is not taxable.
Past and Future Lost Income
Because of the extensive treatments people with non-Hodgkin’s lymphoma have to undergo, they could miss work for a significant time. Through a Roundup settlement or lawsuit, the victims could recover compensation for the past and future income loss they have and will endure.
Compensation that the victims recover for lost income may be taxable because the IRS would have taxed the income they originally received. With that, they can also tax the lost income damages the victim received through a settlement or lawsuit.
Pain and Suffering
Attorneys can help calculate an estimated value for pain and suffering. These damages account for the pain the victims have experienced to the date of the settlement and the discomfort they may endure in the future. These are non-economic losses, meaning they don’t associate with a monetary loss.
Because of this, attorneys can use formulas, their evaluation of economic damages, and other means to calculate their estimated value. The IRS does not usually tax pain and suffering damages.
Going through cancer treatments can cause significant emotional turmoil. These are a major component of cases involving people who have developed an illness because of Roundup. The compensation someone could recover for emotional distress damages varies based on how their mental health suffered. For example, did they endure insomnia or experience anxiety or depression?
Typically, when someone recovers compensation for emotional distress damages, they do not have to pay taxes.
Wrongful Death Damages
Sometimes, surviving family members file a wrongful death action if they lost their loved one due to cancer resulting from Roundup exposure. They may pursue funeral and burial costs, medical bills for final treatment, and lost income. The IRS may forego taxing all of these damages except for lost income.
Things to Know When Filing Taxes After Receiving a Settlement
After receiving a settlement, it’s essential to know how to inform the IRS appropriately. This way, plaintiffs who received settlements can avoid dealing with any tax issues. The information they should provide to the IRS about a settlement includes:
- How much of the settlement was income
- If the settlement check was a lump sum or if the plaintiff will receive scheduled payments
- The amount of legal fees the plaintiff has to pay
By providing this information, the plaintiff can ensure they file taxes correctly and don’t get any penalties after receiving a settlement check.
An Attorney Can Help You File Taxes After Receiving a Roundup Settlement Check
After receiving compensation, you might wonder if you have to pay taxes on a Roundup settlement check. Most of the compensation you recover will not be taxed. The only taxable part of the check may be the lost income you recovered. Knowing how much of the settlement recovery accounts for lost income is important. A mass torts attorney can help you determine how much of your settlement check should be taxed. Connect with a law firm to get started on a Roundup lawsuit or learn how to properly pay taxes on a settlement. After filling out the contact form, you can speak to an attorney from our network at no cost. They can review your case and provide pertinent information that helps ensure you follow the proper tax laws.