QUESTION

How can I avoid taxes on employment discrimination lawsuit?

Asked on Aug 09th, 2011 on Taxation - Illinois
More details to this question:
I am thinking of settling an employment discrimination suit but want to avoid paying as much tax as possible otherwise I could end up owing more than I was awarded after attorney fees, taxes and other expenses plus I'm losing my EIC this year if I do settle because income will be too high to qualify. I'd like to pay my mortgage company directly from winnings if it's possible to avoid taxes that way as well. Thanks.
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1 ANSWER

Chapter 7 Bankruptcy Attorney serving Lisle, IL at Mankus & Marchan, Ltd.
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Any awards from an employment discrimination suit are income to you and you have to pay income taxes on the award. The employer should issue you and the IRS a Form 1099 reporting the award.
Answered on Aug 10th, 2011 at 4:48 PM

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