If you’ve been badly injured in an accident, it’s important to maximize the value of any financial compensation you recover from the at fault parties. You may need that compensation to last for many years, possibly the rest of your life. From fighting for a fair settlement to minimizing the taxes you may need to pay on that settlement, there are several things you can do to protect your financial future.
Here are some tips from the California personal injury lawyers at Demas Law Group, P.C., on how to make the most of your personal injury case settlement. Keep reading to learn more.
Hire a California Personal Injury Lawyer
Often, the biggest factor that affects the value of a legal settlement is whether you hire a personal injury lawyer. While you can file a personal injury claim without legal representation, it can be extremely difficult to manage while you’re recovering from serious injuries. A personal injury lawyer will have knowledge, training, and negotiating skills to help you pursue the full amount of compensation you are entitled to.
Don’t Settle Too Soon
Insurance companies often come to claimants with a settlement offer right after an accident. They know victims will face steep medical bills, as well as lost wages if they cannot work. But if your injuries are severe, there’s no way you can anticipate the true value of your claim within a few hours or days after an accident. If you accept a settlement too soon, you can’t go back and ask for money later, so get help from a California personal injury lawyer before agreeing to anything.
Explain Why the Offer Is Inadequate
There are many types of losses you can be compensated for after an accident. If you feel the settlement offer you’ve received is inadequate, check with a lawyer. They can help you determine a fair counter-offer to the insurance company.
Highlight the Emotional Impact
One area of compensation victims often neglect in a personal injury claim is the emotional effect of what happened. It’s common for people to experience anxiety, depression, and post-traumatic stress disorder (PTSD) after a severe accident. But it’s hard to put a dollar figure on emotional distress by yourself. A lawyer can help with that so that you settle for more.
Understand and Address the Tax Implications
While most compensation from personal injury settlements is usually not taxable, your tax liability could vary depending on what you’re being compensated for and how your settlement is structured.
For example, the compensation you receive for medical expenses and pain and suffering from an injury is generally not taxable. However, compensation for lost wages may be taxable and punitive damages will certainly be taxed. Make sure to get an attorney’s help to structure your settlement so that you walk away with as much as you can.
Lump-Sum vs. Structured Settlement
Most personal injury case settlements are paid out in a lump sum, meaning you receive the entire settlement in one payment. However, some settlements are structured so that incremental payments are made over time, usually a period of years.
There are potential downsides to a structured settlement. For example, if the insurance company handling your payments goes bankrupt, you may not receive the rest of your settlement.
However, there are certain advantages to structured settlements. For one, they prevent you from spending your settlement money too quickly. There are also taxes advantages to going this route as well.
Although it’s generally recommended that you take a lump-sum settlement, an experienced personal injury attorney can advise you on the various options that may be best for you.
Contact a California Personal Injury Attorney Today
The Sacramento personal injury attorneys at Demas Law Group, P.C., have spent more than 25 years helping California accident victims recover fair compensation after being harmed due to others’ negligence. Contact our office today for a free initial consultation.
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