No, no, no. A million times no. Let me be crystal clear, neither workers' compensation benefits, nor workers' compensation settlements are taxable. To determine a workers' compensation rate, one takes the injured workers' gross wages from the thirteen (13) weeks prior to the accident and divides by the number of weeks worked. Once you have that number, you multiply it by ⅔. This process of taking only 66% of your salary is the way that the workers' compensation system accounts for taxes. You never have to pay taxes on any benefits you receive under workers' compensation. Even if you do not receive weekly checks from workers' compensation and only receive a lump sum settlement for your injury, you are never taxed on this amount. This does not mean that benefits are exempt from child support and bankruptcy proceedings, it only means that YOU ARE NOT TAXED ON ANY BENEFITS YOU RECEIVE UNDER WORKERS' COMPENSATION.