Compensatory Damages

Compensatory Damages

The Compensatory Damages are.

payment to a person who has suffered harm, such as for loss of income, expenses incurred, property destroyed, or personal injury. In general, except for damages for personal injury, these payments are taxable. Recovery of a person's previously deducted expenses is taxable under the tax benefit rule.

In other words, is a compensation awarded for actual physical injury, physical sickness, or emotional distress.


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