If you are injured in a car accident, the odds are good you are facing some financial strain. Medical bills from a serious injury can quickly become overwhelming. If you are too hurt to return to work, your finances could face additional strain. A negotiated settlement with the at-fault driver or their insurance company could go a long way to ease this financial strain. However, it is vital that you consider the complete financial picture before agreeing to a settlement amount. For example, your settlement could be subject to taxation in some cases. Most of the time, your personal injury claim will not be taxable by the state or federal government. That said, certain forms of compensation may be taxable depending on the circumstances.