Workers’ Compensation in Illinois and Taxation Concerns
Getting approved for workers’ compensation is a daunting and uphill task. As Chicago’s premier workers’ compensation attorneys, we help you get paid when you’re injured at work or suffer an occupational disease that makes it difficult or impossible to get back to work. The question, however, on most of our client’s mouths is whether workers’ compensation benefits are taxable. This is a valid question due to the fact that most injured Chicago employees won’t be able to get back to work after an injury, meaning that they have to guard every penny that comes in and ensure that they not only make sound financial decisions, but also abide by the law as it relates to taxation.
Are you looking for a workers’ compensation law firm in Chicago? Please call our offices NOW at 1 (773) 825-3547 for more information on what we can do for you. Our Illinois workers’ compensation attorneys are here for you and possess over 20 years of experience fighting for injured individuals. The call is free, and we take on cases on a contingency fee basis meaning you won’t have to pay us anything until we win your case for you. Call 1 (773) 825-3547 RIGHT NOW and speak to an experienced workers’ compensation attorney in Chicago to discover whether you have a valid case as well as its potential value.
What Does The Law Say?
Thankfully, workers’ compensation settlements are tax-exempt as long as they are paid in accordance with the Workers’ Compensation Act. This means you won’t pay any taxes on your settlements at the local, state or federal level. That being said, you are required by law to report these benefits in your W-2 tax form. The IRA also has in place a legal statute that states you’re not to pay for taxes on workers’ compensation benefits if you sustained an injury or suffered occupational sickness and had your benefits paid via workers’ compensation law. On top of that, the IRS has verbiage in IRS Publication 17 which states that your survivors, should they be beneficiaries of your workers’ compensation benefits, are exempt from paying taxes on these benefits.
What Benefits Are Taxed? Chicago Workers’ Compensation
We however have to point out that retirement benefits received as a result of occupational sickness or related injury are taxable. This includes things like benefits that are dependent on length of service, age, and prior plan contributions. Lastly, your Social Security benefits will be taxed if you’re receiving them in tandem with workers’ compensation benefits.
Need More Information? Call Us Now!
Are you an injured worker needing free legal advice on workers’ compensation laws in Illinois? Please call us TODAY at 1 (773) 825-3547 for more information on what steps to take next to secure your benefits so you’re assured a comfortable future going forward. Thanks, and we look forward to hearing from you.