Claiming Loss of Earnings After Car Accident

Car wreck injuries may result in lost wages. Unfortunately, many do not have comp, sick or vacation time available. Unpaid absences can create serious cash flow problems. In addition to medical bills (deductibles and co-pays for those with health insurance) you may need to initially pay for rental cars and vehicle repair bills. Not to mention the rent or mortgage and basic living expenses. 

You may wonder whether you will be reimbursed for the lost benefits or missed hours. Yes, loss of earnings after car accidents can be reimbursed. In fact, Tennessee law requires fair monetary compensation after sustaining a personal injury. This includes loss of earnings after a car accident.

Car Accident Lawyer George Angelopoulos recovers compensation for injury victims across Tennessee. We work with doctors to ensure proper documentation to protect this important compensation right. Failure to properly document loss of earnings after car accidents can result in a denial of lost wages. Call 615-422-7171 or complete our case review request to begin your free auto accident consultation.

Types of Lost Wages

Loss of earnings includes actual missed income and what would (not could) have been earned on the job. The money or benefits lost can add up quickly. This can get tricky.

• Lost income is the amount that you earn at work. Whether you are paid hourly, weekly, or monthly we must definitively calculate your loss of earnings. The before tax value of your time at work times the number of hours, weeks or months missed equals your car accident loss of earnings. Overtime is an important factor. Many insurance adjusters will only offer the straight time, but if you have a history of overtime hours (1.5x), shift premiums or bonuses in play then the stakes are higher.
• Lost Benefits is the value of the amount that you earn at work used in the form of a benefit. Comp time, paid sick time or vacation hours can protect cash flow, but this is time not allocated for car accident injury recovery. As with lost income, we determine the cash value of the time missed times the amount of time missed to determine how much value you lost.

Car Accident Lost Wages Self Employed

Loss of earnings after car accidents for the self employed require a little more work. Those who work for themselves do not have a vacation bank to draw from that replaces income. Missed meetings, a sales vehicle in the shop or the inability to meet an important client before signing a big contract can be costly.

The self employed are not entitled to recoup the lost revenue. Self employed loss wages after a car accident is based upon lost revenue less the cost of doing business. Self employed recover profit because recovering the revenue without the associated cost would be more than what you would have earned if the accident never happened.

Self employed lost income claims generally require existing arrangements or definitive contracts that are missed. In most cases, we rely on tax returns to prove lost wages for the self employed.

How Much Tax Do I Pay On A Settlement

You will not pay any federal income tax on a car accident settlements resulting from physical injury. Tennessee does not have a state income tax. Therefore, you will not receive a 1099 after a car accident settlement because personal injury settlements are not taxable income. This applies to money received because of a physical injury. However, money that is specifically attributed to lost income (or confidentiality – covered elsewhere) is to be reported on personal tax returns. There are scenarios where tax benefits were received because of medical expenses when the general rule does not apply. We do not provide tax advice and suggest every client to seek a CPA’s opinion on their specific tax scenario. 

Have Loss of Earnings after Car Accident?

It seems like simple math, but there is more than just adding up numbers. Overlooking a detail can be costly. Car Accident Lawyer George Angelopoulos wants you to get every dollar you are due. Call 615-422-7171 or complete our case review request to begin your free auto accident case review. We can guide you through the process every step of the way.