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Sure, I can help with that! Generally, personal injury awards are not considered taxable income by the IRS. This means that if you receive an award for personal injury, it's typically tax-free, whether it's awarded to one spouse or split between both.
However, there are exceptions. For example, if the award is for lost wages or punitive damages, those portions are taxable. Also, if you took deductions for medical expenses related to the injury in previous years and then received an award that reimbursed those expenses, you may need to include part of the award as income.
As for splitting the award between spouses, that would likely depend on the specifics of the award and the laws in your state, especially if you live in a community property state. In community property states, most property acquired during the marriage (including lawsuit awards) is considered jointly owned by both spouses.
Remember, this is a general overview and your specific situation could be different, so it's always a good idea to keep detailed records and consult with a tax professional if you're unsure.
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