How much should I expect back as a tax return?

Question

In 2007 I made about 15,000 from work got a settlement which 34,000 went to medical bills, 24,000 went to me for damages, and 20,000 Went to my lawyers fees. I had no insurance when the bills got paid and all medical bills were paid by my lawyers. How much of my medical bills and/ or lawyers fees will come back in my tax return?

Answer 1

Not enough info to say exactly but I can take a pretty good guess.

As the settlement appears to be for physical injury to you it is non-taxable unless any of it was earmarked as punitive damages, interest or lost wages. Would need to review the settlement documnets to determine that but assuming that it is all for the physical injury it's tax free. Since it's tax-free, none of the expenditires for the medical bills, attorneys fees, etc are deductible.

Your only taxable income appears to be the $15,000 from work. The income tax on that would be about $625 for a single taxpayer so you'd get a refund of any income tax over that amount that was withtheld from your wages.

If any of the settlement was taxable as noted above you'll probably wind up paying at filing time since taxes are not normally withheld from that type of settlement.