In Florida Workers’ Compensation settlement checks, as well as periodically paid Workers’ Compensation indemnity checks, or even long term annuity payments, usually do not have any withholdings taken from the payment, other than potentially for child support. They differ from pay checks that often have multiple withholdings including; Federal tax withholdings, Social Security, Medicare and other potential withholdings. The Workers’ Compensation indemnity disability check in Florida is paid at a percentage of the income, and even when combined with other collateral sources cannot exceed 80% of the preinjury earnings or may be subject to an offset.
Tax laws are both complicated, as well as subject to change. To answer any form of tax questions regarding any; Workers’ Compensation settlement, periodic payments, or annuity payments; you should consult with either a Certified Public Accountant or a tax attorney to determine any possible tax responsibilities. By consulting with a Certified Public Accountant or an attorney that specializes in Tax law and that has an LLM degree, you can determine if any of the funds received from a workers’ compensation settlement, periodic payment or annuity, are subject to any form of tax consequences and to thus make sure that you have complied fully with any/all potential tax responsibilities.