Taxes on settlements

My question is: When you settle out of court/win a lawsuit, are you taxed on it. If so, what is the tax % in CA?
Thank you for your time.


WS
RCIS

Law suit settlement

To determine if settlement amounts you receive by compromise or judgment must be included in your income, you must consider the item that the settlement replaces. Include the following as ordinary income:
1.Interest on any award.

2.Compensation for lost wages or lost profits in most cases.

3.Amounts received in settlement of pension rights (if you did not contribute to the plan).

4.Damages for: Patent or copyright infringement, Breach of contract, or Interference with business operations.

5.Back pay and damages for emotional distress received to satisfy a claim under Title VII of the Civil Rights Act of 1964.

6.Punitive damages generally are taxable. It does not matter if they relate to a physical injury or physical sickness.

Do not include in your income:
1.Compensatory damages for personal physical injury or physical sickness (whether received in a lump sum or installments).

2.Emotional distress. Damages you receive for emotional distress due to a physical injury or sickness are treated as received for the physical injury or sickness. Do not include them in your income. If the emotional distress is due to a personal injury that is unrelated to a physical injury or sickness (for example, employment discrimination or injury to reputation), you must include the damages in your income, except for any damages you receive for medical care due to that emotional distress. Emotional distress includes physical symptoms that result from emotional distress, such as headaches, insomnia, and stomach disorders.

wrongful death

Where would a settlement for wrongful death fall in that?

Wrongful Death

The taxation of the settlement depends on whether the settlement is for the personal physical injury or physical sickness or from punitive damages. The rule is that if an action has its origin in a personal physical injury or sickness, all nonpunitive damages that flow from the injury or sickness are excludable as payments received on account of physical injury or sickness, whether or not the recipient is the injured party. Therefore, nonpunitive damages received for wrongful death are excluded from income.

And punitive damages received for wrongful death are also excluded if applicable state law provides (by state statute or judicial construction) that only punitive damages may be awarded. An award of punitive damages in such a case is excludable to the extent it was received on account of a personal injury or sickness.

Since you got a settlement, presumably there were no punitive damages. If that is the case, then the settlement is not taxable.

thank you very much