Do you pay state and federal taxes on worker's compensation?
If you happen to be injured while on the job, you are legally eligible for worker's compensation. Worker's compensation is the payment you receive from the company you work for when you were injured while doing your job and it was at the fault of the company. The amount received is completely exempt from state and federal taxes and is your money for how you see fit. Obviously in cases where you must appear in court to prove your injury occurred because of the faulty circumstances in which you were working, you would have to probably pay attorney fees, as well.