Payment for pad classified as "damages". How is this treated for income tax? Taxable or not?

We have received money for pad construction which the company specified as damages. Do we owe income tax for this? Want to do the right thing.

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Permalink Reply by Jonathan H on March 22, 2016 at 3:23am

Talk to an accountant or tax professional; informally should be enough. My understanding is that damages are tax free to a point, and above that they have a lower tax rate than income, but I don't know what the point is and whether it varies state to state.

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