Need To Know Information About Personal Injury Awards
Personal injury awards are meant to help you cover day to day expenses, medical costs and lost wages while you are recovering from your injuries. Money can help you pay for your bills while you are out of work, but it may come with added tax increase and other complications. Here are a few considerations to keep in mind after being awarded a settlement. .
- What damages does the award cover?
You may ask for a number of damages to be compensated for including medical bills, lost wages, medication, physical therapy, and emotional damages like pain and suffering. Your settlement may also include compensation for expected future wages lost. An experienced attorney can help you strategize to prove you deserve both physical and emotional damages.
- Is the money considered personal income?
The money you will receive in a settlement is usually regarded as compensatory which means it is not taxable income. However, you may have to pay some tax for ny deductions you claimed for previous medical bills before they earned the award.
Rarely, punitive damages are awarded to a plaintiff if the court wants to send a message to the defendant that their acts are negligent and to persuade them to never do them again. Those funds are subject to taxation and is filed as income. If you have further questions about those distinctions, call an estate planning lawyer to sort out what you will have to prepare for.
- You may not be able to access the money right away.
You may need to sign a release once you settle a claim and so will the opposing side. This process of creating the release as well as signing it can take weeks so you may not see your money right away and you will need to verify it has been paid.
- Your award may be subject to division if you get a divorce.
Your award may be considered marital property depending on the state laws where you live. If it is considered marital property, you may have to give up a portion to your ex spouse. A divorce lawyer can go through the specifics with you as well as how you can protect your money.
Hiring an Estate Planning Attorney
If you are sure that you will be receiving a payment sometime soon, you will need to plan ahead for it. Cal an estate planning attorney such as the Estate Planning Lawyer Phoenix locals turn to figure out how to best manage your new found wealth. An experienced estate planning attorney will be able to give you more specific advice related to the amount you are awarded and the assets you already have. Don’t wait, secure your financial future today.