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For example, a settlement for unpaid wages is taxed like wages. Settlements for physical injury are not taxed. Settlements for emotional distress are not taxed if the emotional distress was related to a physical injury, but are taxed if the injury was purely emotional. Punitive damages and interest are taxable.

What's This Settlement About? A $58 Million Settlement has been paid out to users and customers of Plaid Inc. (?Plaid?). Consumers are reporting $35.97 payments in their inboxes, PayPal accounts and Venmo statements.

If you receive a taxable court settlement, you might receive Form 1099-MISC. This form is used to report all kinds of miscellaneous income: royalty payments, fishing boat proceeds, and, of course, legal settlements. Your settlement income would be reported in box 3, for "other income."

To start the process, you'll fill out a simple form. You can mail in a printed version or do it online at facebookuserprivacysettlement.com. If you are a current Facebook user, you should also have received an alert in the app or site that links to the settlement page and instructions.

How do I claim money from the Facebook settlement? If you're a Facebook user in the U.S. who joined between , and Dec. 22, 2022, you can submit an application online at facebookuserprivacysettlement.com to claim your settlement.

The general rule regarding taxability of amounts received from settlement of lawsuits and other legal remedies is Internal Revenue Code (IRC) Section 61. This section states all income is taxable from whatever source derived, unless exempted by another section of the code.

A structured settlement is an arrangement in which the settlement payment is paid out over time, rather than in a lump sum. This can help to avoid taxes on the settlement payment by spreading out the tax liability over a longer period of time.