Are my Workers’ Compensation Benefits Taxable?

by The Bainbridge Firm, LLC | Jan 08, 2020 | Workers' Compensation

At the beginning of each year you expect to receive certain tax information from your employer. When you receive workers’ compensation benefits, many injured workers expect to receive tax paperwork from the BWC or their employer. It is important to know that you will not receive any paperwork in the mail regarding money that has been paid as part of a workers’ compensation claim as the money is tax free. This can come as a surprise to people as they expect to be taxed on any money they receive in lieu of wages.  

It is also important to understand that when you are receiving monetary benefits as part of a workers’ compensation claim you are not necessarily receiving other benefits such as insurance, 401k, long term/short term disability. If you are being paid directly by BWC you will simply receive your benefits only. BWC does not offer health insurance or coverage and only covers treatment for allowed conditions in your claim. If you receive a check from a third party administrator it is important to confirm what benefits you may be responsible for taking care of separately with your employer. These issues can become very complicated. If you have questions about your benefits please contact us to assist you.