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Deciding Whether to Take a Public Injury SettlementMany personal injury cases end with a settlement before heading to court. By filing a personal injury claim, you may receive a settlement offer from the liable party or its insurer. Accepting a settlement is quicker and less expensive than filing a lawsuit, although you would likely receive more compensation in a successful lawsuit. However, there are situations where it is wiser to file a lawsuit than accept a settlement. A personal injury attorney will consider several factors when advising you on your case:

  1. How Much Is the Liable Party Offering?: The insurance company would prefer to pay you the minimum amount necessary in response to your injury claim. You must consider whether the settlement amount will fully cover your injury expenses. The insurer may dispute the extent of your injuries or whether certain treatments are necessary for your recovery. Some insurers have a maximum payable amount for injury claims. You may need to file a lawsuit if the insurer cannot or will not offer enough compensation for your injury.
  2. How Much Do You Need For Pain and Suffering?: An out-of-court settlement can include compensation for pain and suffering if your injury caused a decline in your quality of life. However, compensation for pain and suffering can be a subjective amount, even if both sides agree that it should be part of the settlement. There are different formulas to quantify pain and suffering compensation, and some of the values in the formulas depend on how severe you consider the injury to be. By filing a lawsuit, you can let the court decide the appropriate amount of pain and suffering compensation.
  3. How Strong Is Your Case?: Illinois uses comparative fault when determining the amount to award in a personal injury lawsuit. Even if the court finds in your favor, it can decrease your award if it determines you were partially at fault for the incident that caused your injuries. You will receive nothing from the case if the court decides that the defendant was not at fault or that you were more than half at fault for the injury. If there is serious doubt about who was at fault, you may risk receiving less from the lawsuit than you would from the settlement.

Contact a McHenry County Personal Injury Attorney

Before deciding whether to accept a settlement, you should speak to a Crystal Lake, Illinois, personal injury lawyer at Botto Gilbert Lancaster, PC, to determine if it is a fair offer or if you would benefit more by filing a lawsuit. Schedule a free consultation by calling 815-338-3838.

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Injury Compensation Considered Marital Property in DivorceFor people who have suffered serious injuries, their monetary compensation can be vital to supporting themselves. Compensation can come in multiple forms, including a personal injury settlement, workers' compensation benefits and disability benefits. The injury victims need the monetary award because:

  • The short- and long-term medical costs can be exorbitant;
  • They may have lost significant wages while recovering from injury; and
  • Their injuries may prevent them from obtaining employment for an indefinite period.

If you are going through a divorce, you may assume that you can keep all of your injury compensation. It seems only fair because you are the person who went through the pain and suffering and are still being affected by it. However, Illinois courts have consistently ruled that money accrued due to injury is marital property.

Defining Marital Property

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personal injury judgment, Crystal Lake Personal Injury LawyerWith the New Year, most people are concerned about filing their taxes. However, for an individual who has suffered an injury and received a settlement, there may be a concern about paying a large amount in taxes based on the settlement.

Generally speaking in Illinois, money received as a result of a judgment or settlement in Illinois is not taxable as gross income. This is because these funds are considered to be received by the injured person as compensation. Therefore, sums received to pay for medical care and other associated costs which directly address the underlying loss are not taxed. However, funds awarded as a punishment to the defendant, that is, punitive damages, are taxable because they do not directly affect the injured party's loss. Another notable exception is for funds received for lost income or wages because the injured party's regular income or wages would have been taxed.

Under federal law, whether or not you pay taxes on compensation received depends on the kind of injury sustained and on what the compensation is based. Compensation that stems from physical injuries or sickness is generally not taxable depending on whether or not the taxpayer previously deducted his or her medical expenses. If a person receives compensation for emotional distress as a result of a physical injury or sickness, the funds are not considered taxable income either.

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