Taxes and Workers’ Comp Income
If you’re receiving workers’ compensation in San Jose, you may wish to consult a lawyer about your benefits. Workman’s compensation is not generally taxable income. However, there are exceptions.
If you are also receiving Social Security benefits, these benefits may be offset by your workers’ compensation benefits. As your lawyer can explain to you, this means that the amount you’ll receive in Social Security benefits can be lowered. The amount by which it is lowered is considered taxable income. For example, if you receive $1,000 in Social Security benefits and your check is reduced to $850, $150 of your workers’ compensation is taxable.