Are my workers’ compensation benefits taxable in Georgia?
If you are receiving workers’ compensation benefits or a settlement of your workers’ compensation claim, you may be wondering if you have to pay taxes on this income. Fortunately, you most likely will not owe taxes on what you receive.
Non-Taxability of Workers’ Compensation Benefits
The state of Georgia follows the federal income tax laws, which provide that workers’ compensation benefits paid under a workers’ compensation law or statute for an occupational injury or illness are not taxable. This rule can also apply to survivors of a worker who was killed in a workplace accident who receive death benefits.
Exceptions to Workers’ Comp Taxation Rules
While workers’ compensation benefits are generally exempt from taxation, there are exceptions to this rule, including the following:
- If you receive retirement benefits that are based on your age, years of employment, or occupational injury or illness, these benefits would be taxable income.
- If you return to work on light duty, you may continue to receive a portion of your wages as well as workers’ comp benefits. Your wages would be taxed.
- Workers’ compensation benefits are generally not paid with interest. However, if you received interest as part of your settlement, the interest would be taxable income.
- If you receive Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI) and workers’ comp benefits, your combined benefits must be below a certain threshold or your Social Security payments may be reduced and taxed in part. However, an experienced workers’ compensation attorney may be able to structure your settlement to avoid these consequences.
Have You Been Injured At Work?
If you’ve been injured on the job you need to speak with an experienced workers’ compensation lawyer as soon as possible. Contact us online or call our Augusta office directly at 706.863.6600 to schedule your free consultation.