Taxing California Elder Abuse Recoveries

Robert W. Wood

Robert W. Wood is a tax lawyer with Wood LLP, and the author of numerous tax books including Taxation of Damage Awards & Settlement Payments. This discussion is not intended as legal advice.

The U.S. Department of Health and Human Services and Department of Justice report that each year, up to 5 million older persons are abused, neglected, or exploited.¹ Some studies even suggest that as few as one in 23 cases of elder abuse is reported to authorities.² Legislatures in all 50 states have passed some form of elder abuse prevention laws. The laws vary considerably, but abuse can generally be broken into multiple categories, including:

• Physical Abuse, generally involving the infliction of physical pain or injury on a senior;
• Sexual Abuse, involving non-consensual sexual contact of any kind;
• Neglect, such as by failing to provide food, shelter, health care, or protection for a vulnerable elder;
• Exploitation, involving the illegal taking, misuse, or concealment of funds, property, or assets of a senior for someone else’s benefit;
• Emotional Abuse, including the infliction of mental pain, anguish, or distress on an elder person through humiliation, intimidation, or threats; and
• Abandonment, involving the desertion of a vulnerable elder by someone with responsibility for care or custody.³