Workers’ Compensation: Can Your Benefits Be Taxed?

We all know that your earnings are taxable, but what about your compensation? We meet with people who have been injured at work every week. While they know a little bit about workers comp in Florida, they still have a lot of questions. One of the things they ask is why they only receive weekly benefits equal to 2/3 of their average weekly wages. It seems unfair. Why don’t they receive 100% of their wages? Another question they ask our workers’ compensation attorneys in Tampa, Florida is whether their benefits are taxable.

Here, we’ll answer both questions. The simple answer as to whether your benefits are taxable is no. And, since they aren’t taxed, it may make more sense that you’re only receiving 2/3 instead of 100%. We’ll try to explain this here as best we can. However, if you still have questions about your own workers’ comp case, give us a call. You can sit down with one of our personal injury attorneys in Tampa. They’ll answer your questions and even explain how the process works.

How Do You Know That Your Claim Has Been Approved?

It’s important to understand that, unless your workers’ comp claim is approved, you won’t receive any benefits at all. Typically, if your claim has been approved, you’ll be notified by mail and possibly by email. Your approval letter will confirm the amount of benefits you’ll receive every week. It will also explain that your medical care will be covered as well.

As your workers’ compensation lawyer in Tampa, Florida will explain, you must meet certain criteria to have your claim approved. These basic requirements include the following:

  • Your accident happened on company property
  • You were hurt on company time
  • You were acting within the scope of your employment at the time of your accident
  • You weren’t under the influence of drugs or alcohol at the time of your injury
  • You report your injury to your manager or Human Resources
  • You agree to be seen by a state-approved workers comp doctor

As long as you meet these criteria, your claim should be approved. If not, make sure you ask your personal injury attorney in Tampa to help you appeal your claim.

What Benefits Will You Receive Under Workers’ Comp in Florida?

If your workers’ compensation claim in Florida is approved, then you’ll receive two types of benefits. The first type is medical care. Any of the medical treatment you need as a result of your workplace accident will be covered. This includes hospital bills, physical therapy, and prescription medications.

Your medical care will be covered until your state-approved workers’ comp doctor decides that you’re ready to return to work. They refer to this as your reaching maximum medical improvement. This means that, no matter what other medical care they provide, you will not get any better. It’s at this point that the insurance company will decide whether you’re able to return to work or if you’ll end up on disability.

The second type of benefits you receive under workers’ compensation in Florida are weekly replacement wages. You don’t qualify for these benefits until you have been out of work for seven working days. This is when your benefits will kick in. if you end up being out of work for more than twenty-one consecutive days, you’ll receive retroactive pay for that first week. Your benefits will be paid weekly and will be equal to 2/3 your average weekly wages.


Are Your Weekly Replacement Wages Taxable?

One of the nice things about workers’ compensation is that your benefits aren’t taxable. The federal government exempts any money collected through workers comp. As long as your payment is related to a workers’ compensation claim, it is not taxable according to the Internal Revenue Service.

The other thing you need to know is that Florida does not require its residents to pay state taxes. So, even if the state wanted to tax your workers’ comp benefits, they couldn’t. What this means is that none of your benefits are taxable.

One of the reasons why you only receive 2/3 of your average weekly wages is because your benefits aren’t taxable. If you were receiving your normal paycheck, you would be paying federal taxes, FICA, SSDI, and any other employment taxes. These deductions add up to much more than 33%. At least for most people. Some people are in such a high tax bracket, that their income is taxed at close to 40-45%.

Our Workers’ Comp Attorneys in Tampa Can Help You Get the Benefits You Deserve

If you’re worried that your workers’ compensation claim will be approved, you should definitely call an attorney. Sometimes, it helps to sit down with a personal injury attorney in Tampa. They can help you see exactly where you stand as far as your claim is concerned.

If you haven’t heard back from the insurance company, then we understand why you’re frustrated. All you want to know is whether your claim was approved. If it was – great. You’ll start receiving benefits in a matter of weeks. If it was denied, then you’ll need a personal injury attorney in Tampa to help you. They can file an appeal on your behalf.

Sit Down With One of Our Experienced Personal Injury Attorneys in Tampa

If you’re worried that your workers’ compensation benefits are going to be taxed, you can relax. As explained here, you won’t pay federal or state taxes on your workers’ comp benefits. Your bigger concern should be whether your claim is approved or not. Until you confirm that you’ll be receiving benefits, it won’t matter whether they’re taxable.

We recommend that you call and speak with one of our experienced personal injury attorneys in Tampa, Florida. They have years of experience handling cases just like yours. They not only understand the workers’ comp process in Florida, but they also understand the tax code as it relates to workers’ compensation benefits.

All you have to do is call and schedule your free, initial consultation with our office. Call our front desk and find a date and time that works for you. Or, if you’d rather make your appointment online, you can do that too. Just visit our website and either chat with one of our agents or contact us via email.

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