A frequent question we receive from injured workers and other attorneys is whether an injured workers weekly indemnity benefits (Lost Wages Check) or lump sum settlement are taxable? In New Hampshire, workers’ comp indemnity benefits and lump sum settlements are not considered taxable income.
However, if you return to work on a part-time basis and receive partial checks from your employer and partial workers’ compensation checks, wages from your employer would be subject to federal income taxes. Furthermore, if you receive Social Security Disability Benefits and workers’ compensation you may be subject to federal income on your Social Security Disability benefits.
Finally, if you are receiving Social Security disability Benefits and settle your workers’ compensation case, it is important to structure any lump-sum settlement with social security offset language to reduce or eliminate any offset. This social security offset language will spread out your settlement over your lifetime on paper, while in actuality you will receive the entire lump sum settlement soon after the lump sum settlement. Simply put, it is important to consult with an attorney that has familiarity with workers’ comp and social security to maximize any settlement you receive.
If you have any questions about workers’ compensation or Social Security Disability Benefits, please contact Ward Law Group at (603) 232-5220 or fill out a simple form at wardlawnh.com for a free consultation.