If you have a work injury claim because you were injured on the job, you may have a challenging path ahead of you to ensure that your case is resolved in your favor. Once you receive benefits or a settlement from your employer’s insurance company, other parties, such as your attorney, doctors, and government agencies, may have a claim on a portion of that money.
So, how much of your compensation for a work injury can you actually keep? This is a legitimate inquiry. It is also advisable not to be surprised by what you may have to pay to third parties once the process is well underway. This article lists fees and payments you may be required to make with your settlement funds.
Work Injury Attorneys’ Costs And Fees
Many work injury attorneys in California charge what is known as a “contingency fee.” This essentially means that you will not incur any costs or fees upfront. However, your attorney will receive a percentage of the money you receive in a settlement or award for a workplace injury. If you do not receive any benefits, you will not owe anything.
California limits attorneys’ fees in workers’ compensation cases to 15% of the amount awarded to the worker, as opposed to the 30% to 40% contingency fee a personal injury attorney may charge in a car accident or other personal injury case. In addition to the contingency fee, you will be responsible for reimbursing your attorney for any expenses, such as copying medical records, hiring expert witnesses, and court reporters to transcribe depositions that he or she may have advanced.
Unpaid Work Injury Medical Bills
If your initial claim for a work injury is denied, but your appeal is successful, the judge may order the insurance company to pay your medical bills in addition to your workers’ compensation settlement or award. If you have already paid your medical expenses, you may keep the award money designated for those costs. However, if your doctors permitted you to defer payment of your medical bills until you received your workers’ compensation settlement, you are required to pay those bills after receiving your settlement or award.
In certain instances, your attorney for work-related injuries may negotiate a settlement that requires the insurance company to pay a portion of your medical bills directly. In most cases, however, the settlement will include a lump sum for medical expenses. Your attorney may withhold a portion of the settlement to cover the unpaid medical bills, but he or she may also be able to negotiate a reduction with your medical providers. If this occurs, you will retain a larger portion of your workers’ compensation settlement.
Will I Owe Taxes On My Work Injury Settlement?
State and federal taxes will not apply to your work injury settlement or award. The only exception to this rule is if you also receive Social Security Disability Insurance or SSDI benefits. If your combined SSDI and workers’ compensation benefits are high enough, your SSDI benefits may be reduced, a process known as “offsetting.” You may be required to pay taxes on the offset amount. Your work-related injury settlement may also affect your eligibility for certain tax credits, as the IRS may consider the amount you receive as income when determining your eligibility for those credits.
Pistiolas Law knows that healing from your work injury and navigating a complicated legal process can be difficult for you and your family. Your choices now may affect your financial future. Call (844) 414-1768 to schedule your free consultation and comprehensive case evaluation.