The payment of punitive damages that are owed as a result of wrongdoing or neglect. Restitution payments are an attempt to restore a person to a previous financial condition that should have persisted for the improper actions of another person or entity. Restitution payments are usually paid according to a schedule dictated by the court, but often will not begin until after the defendant/payer has been released from prison, if jail time is also served.
Some restitution payments are tax free, but payers cannot deduct restitution payments by donating them to a qualified charity.
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