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Taxes due on EEOC settlement?????

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copnlpn2

Guest
Will taxes be due on the $50,000 cash settlement my husband will receive shortly following successful EEOC mediation with his former employer? The EEOC obtained this latest settlement for us in Oklahoma after this same employer violated the terms of an earlier settlement. Will taxes be due on the additional $7,000 my husband will receive for back wages as part of this new settlement?
 


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buddy2bear

Guest
You really should ask a CPA. I think though that if the settlement amount, or portion thereof, is for back wages, then the applicable taxes would need to be paid. Sometimes when an award is given, the employer will automatically deduct the taxes to be on the safe side. Sometimes the employer is sufficiently ticked off, that it lets you worry about it, particularly since the employer would have to pay their share of the taxes, unemployment, etc., which would increase their payout above the award. If you don't want to call a CPA, you can call the IRS information line, although I have heard that they give out wrong information at least 50% of the time!
 

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