I received a workers? compensation checkwith two forms. A WCC form #16A and also a form 19. Which of these do I use to deposit the check to avoid having to pay taxes?
Ask the insurance company to issue two checks of $5000 each.
Per IRS Publication 525
"Amounts you receive as workers? compensation for an occupational sickness or injury are fully exempt from tax if they are paid under a workers? compensation act or a statute in the nature of a workers? compensation act. The exemption also applies to your survivors. The exemption, however, does not apply to retirement plan benefits you receive based on your age, length of service, or prior contributions to the plan, even if you retired because of an occupational sickness or injury."
You do not pay income tax on WC benefits and all you need to do is keep the check stub in case you are questioned about the deposit. amount(which is doubtful). Good Luck
It doesn?t matter.I don?t know of any state where your workers comp benefits count as income.
Source: http://polyno1.com/workers-compensation-payment-over-10000/
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