Is a monetary award for job discriminstion taxable as income?
- David Greene
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Unfortuantely, a monetary award of this tyupe is considered income by the IRS. When someone is physically injured and gets a money award from settlemenet or trial, that money is not taxable. The key words here are “physical injury.” Emotional distress is not cosidered a physical injury and, of course, discrimination is not physical. Therefore, the award is taxable as income. Sometimes a non-physical cause of action, such as discrimination in the workplace, is accompanied by a physical harm. For instance, if the boss shoves the employee, this is a physical assault. Thus a jury can award a certain amount for the assault and another amount for the discrinimation. In this case the assault portion would not have been taxable.