Injury Lawyer Blog

Personal Injury Proceeds Generally Not Taxable

If you have been injured in a car crash, slip and fall, assault, dog bite or any other type of personal injury claim, the money paid to you, by either judgment or settlement, is not taxable. This applies to money you receive for medical bills and expenses, lost income and for pain and suffering. Both the federal government and Oregon impose no taxes on money paid due to a personal injury claim.

However, your injury must be physical, such as cuts, bruises, muscle strain or sprain, broken bones, soft tissue injury, sickness or any physical conditions verified by a qualified doctor. A purely emotional distress claim will be taxed.

If there is any doubt about whether your settlement is tax free, it is best to consult with an accountant or tax attorney before you start arguing with the IRS.

If your claim is filed in court and then settled, what is alleged in the complaint could be dispositive on how the IRS treats your settlement money. For example, if you sued for sexual harassment and did not allege any physical injury in your complaint, the money you received would be taxable as income to you.

In drafting a settlement agreement of a complaint that has a mix of taxable and non-taxable claims, your attorney should be able to draft a settlement agreement that allocates the settlement proceeds to those counts or claims that are nontaxable. Usually, the other side will not object.

The nontaxable treatment of personal injury money also applies to structured settlements, where you receive annual payments over a period of years instead of one lump sum.

Whether your injury money is taxable can sometimes affect your decision whether to settle a personal injury claim. Knowing that the amount you receive is fully yours and not taxable adds value to the settlement. It also reduces stress around tax time.

How Injury Settlements Work

Did you know that over 95% of all injury cases settle before trial? Why is that? The judicial system heavily favors the private settlement of civil disputes. It eases the caseload burden on the court system by reducing time consuming and costly litigation.  Evidentiary rules prohibitions against the use of statements made during settlement negotiations as well as offers of settlement from being admitted as evidence in court.

What Happens If My Case Settles?

If your case settles, you will be required to sign a document called a “release.” A release is basically a contract you enter into in which you promise not to pursue you case in exchange (usually) for payment of a sum of money.  After you sign a release and have been paid the settlement money, your case will be ended. If you have a case pending in court, your attorney will take steps to dismiss it. The important thing to know is that when you sign a release in exchange for payment of money to settle your case, you give up the right to make any more claims, known or unknown, against the parties to the release.

When Does A Settlement Happen?

A settlement may occur at any time during the existence of a legal dispute. It can occur up to and beyond a jury verdict. Settlements usually occur when both sides have investigated and uncovered all the facts pertinent to a dispute and, based upon the facts, know the law pertinent to the claims and defenses. The theory is, if both sides to a dispute know all the facts and understand the pertinent law, the parties to the dispute are in a good position to settle because “all cards on the table .”

Why Does A Settlement Make Sense?

Once you know all the facts and the applicable law to your dispute, you are in the best position to settle the case. A settlement is often the optimal outcome to a dispute because you are in control of the ending of the dispute. If you cannot settle your dispute and you go to trial, a jury or judge will decide the outcome. You have then given the power over the outcome to a third party. And you may not like the outcome you get.

Juries are notoriously unpredictable. No matter how good you think your case is, you could lose it if you give it to a jury. This is another reason why 95% of all cases settle. Control over the outcome.

Is My Case Ready To Settle?

There is an old saying: Don’t rush into something you cannot rush out of.

Because of the finality of a settlement, it is important to proceed to settlement with caution. An important consideration before you enter into a settlement is whether your injuries have received maximum medical treatment. If you have fully healed from your injuries, the decision to settle is a safe one. However, often folks rush to settle before they know the full extent of their injuries. Unless you are doctor treating yourself, you are taking a risk to settle your case before you know the full extent of your injuries and all the available treatment options to address your symptoms. An experienced injury lawyer will help guide you to fair and optimal settlement based upon the medical status of your injuries.

Call For Free Evaluation

Give me a call at 971-727-9226 to discuss your case. I serve the Fairview, Gresham, Troutdale and the Greater Portland area including Beaverton, Gresham, Hillsboro, Milwaukie, Lake Oswego, Oregon City, Fairview, Wood Village, Troutdale, Tualatin, Tigard and West Linn . I provide free consultation and I do not get paid unless you win. Most consultations are conveniently available remotely, or you may come see me at my office in Historic Troutdale. I work hard to maximize all the benefits you are entitled to.

What is “Premises Liability”?

A premises liability claim is simply a claim against the owner of property for injuries that occur on property due to a hazard existing on the property. It could be a slippery floor, ice on a walkway, a defective staircase, a railing that was not up to code. It could be a tripping hazard such as a cable or cord on the floor, or a hole in the ground. The examples are almost endless. Basically, the owner or occupier of the property is liable for hazards on their property that are likely to cause injury to persons lawfully on the property.

The law imposes a duty on property owners to keep their property reasonably safe for persons lawfully on the premises with their express or implied permission.

The reason you were on the property is an important consideration to the nature of the duty owed by the owner in the event of an injury. If you are on the property at the express or implied invitation of the owner, the owner owes you a duty of due care. If the owner stands to profit from your presence on the property, such as a restaurant or store, the owner is charged with a duty to inspect and eliminate potential hazards, or to warn the customer. An example of this may be a caution sign that the floor is wet.

There are many, many case decisions detailing the various considerations that define your legal status on the premises, as well as the duty the owner owes to you based upon your legal status on the property.

Protect Your Injury Claim

If you have been injured on business premises, it is important to notify a manager at the store that you have been injured. Most big stores like Home Depot, for example, have forms for customers to report how the injury occurred and what injuries was caused in the incident.

If your injury was caused by a wet floor, take a picture of it if you can. If your injury was caused by a trip hazard, take a picture of it.

What To Expect

If you have ever been hurt in an accident, you have probably had the experience of getting a call from an insurance adjuster to take your statement. Accident victims in premises claims arising in a commercial establishment are often asked to make a written statement about the incident at the time of the accident before leaving the store. This is common practice in big box stores such as Home Depot, Fred Myer, Kohl’s. etc. Insurance companies know the value of getting statements and collecting evidence to arm themselves with in the likely event of an injury claim. Meeting with an attorney of your choice as soon as possible is important for the same reason. An early investigation into the circumstances of the accident by someone on your side is the best way to ensure the evidence needed to prove your claim is collected and preserved. 

Free Consultation- Know Your Rights

Give me a call at 971-727-9226 to discuss your case. I serve the Fairview, Gresham, Troutdale and the Greater Portland area including Beaverton, Gresham, Hillsboro, Milwaukie, Lake Oswego, Oregon City, Fairview, Wood Village, Troutdale, Tualatin, Tigard and West Linn. I provide free consultation and I do not get paid unless you win. Most consultations are conveniently available remotely, or you may come see me at my office in Historic Troutdale. I work hard to maximize all the benefits you are entitled to.

Personal Injury Protection

Personal Injury Protection (PIP) coverage is no-fault insurance coverage for injuries and lost income arising from an automobile accident. Every policy of private car insurance is required to have PIP coverage. PIP insurance covers up to $15000 in medical, dental, hospital, surgical, ambulance and prosthetic services, and 70 per cent of your lost income, if your disability from work due to your injuries lasts at least 14 days. The maximum benefit for lost income is $3000 per month, for 52 months aggregate. It is called “no-fault” because whether or not the accident was your fault, you are still entitled to PIP benefits so long as your injuries arose from the car accident. Fault is not an issue.

If you are injured in a car crash, the insurance policy covering your vehicle, or the policy covering a vehicle of a family member in your household, will provide PIP benefits for your injury treatment and lost income. If you, or no one in your family owned a vehicle and you were injured as a pedestrian, PIP benefits are available after your primary health insurance, or government benefits have been exhausted.

If you were injured in a car crash, you should receive an application for PIP benefits from the liability insurer covering your vehicle. Be sure to fill this out, sign it and send it back to the insurance company as quickly as you can, If you have any questions about the application, feel free to call me (971-727-9226) and I would be happy to answer your questions.

Insurance companies have walled off, separate departments and adjusters who cover liability coverage claims, property loss claims and PIP claims. If you receive PIP benefits, the PIP adjuster is entitled to review all your injury treatment records and bills to ensure that your treatment is related to injuries caused by the accident and the treatment bills are reasonable. If the adjuster becomes concerned that you are over-treating, they may ask you to submit to an Independent Medical Exam (IME). You are required by law to cooperate with reasonable requests for an IME. If you refuse to cooperate without cause, your benefits may be cut off.

If you have been asked to undergo an IME, give me a call. I am happy to help.

Navigating the insurance landscape can be confusing and stressful. Your Troutdale Injury Lawyer can guide you along the way so that you get all the benefits you are entitled to.

Give me a call at 971-727-9226 to discuss your case. I serve the Fairview, Gresham, Troutdale and the Greater Portland area including Beaverton, Gresham, Hillsboro, Milwaukie, Lake Oswego, Oregon City, Fairview, Wood Village, Troutdale, Tualatin, Tigard and West Linn . I provide free consultation and I do not get paid unless you win. Most consultations are conveniently available remotely, or you may come see me at my office in Historic Troutdale. I work hard to maximize all the benefits you are entitled to.