I know we don't have to pay taxes on my husbands workmans comp money that he has received from a work accident.

But do I need to put it on our taxes? When I was using Turbo Tax it asked if we received any Work Comp, and said it would not affect our return, but do I really have to add that to our taxes?

We have 2 children in college and if we have to add his work comp on our taxes I am afraid it will reduce any financial aide that we would get? If we don't pay taxes on it, why should we report it?