Is Your Workers’ Compensation Payment Taxable?
No, workers’ compensation payments are not typically taxable either federally or at the state level. Since these benefits merely replace lost wages caused by on-the-job injuries or illnesses, the IRS considers them non-taxable income. There are exceptions, though — if you get Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI) and your workers’ comp benefits decrease…