{"id":339,"date":"2010-01-05T23:05:00","date_gmt":"2010-01-05T23:05:00","guid":{"rendered":"https:\/\/www.sinklaw.com\/2010\/01\/05\/dont-win-your-personal-injury-claim-just-to-get\/"},"modified":"2024-05-08T00:04:12","modified_gmt":"2024-05-08T04:04:12","slug":"dont-win-your-personal-injury-claim-just-to-get","status":"publish","type":"post","link":"https:\/\/www.sinklaw.com\/blog\/dont-win-your-personal-injury-claim-just-to-get\/","title":{"rendered":"PI Claims &amp; Medicaid or IRS"},"content":{"rendered":"<p><p>When you hire a lawyer to pursue your claim for personal injury arising  out of a car accident, what is the number one thing you are looking for?  People come to us for all sorts of reasons, but to almost everyone it  is important to leave with the most compensation possible for their injury  &#8211; the highest possible settlement or verdict amount. However, clients  and their lawyers must make sure to consider not only the dollar amount  of the settlement check they negotiate, but also how much that dollar  amount will be reduced by other parties who have a claim to the money.<\/p>\n<p>When Medicaid or Medicare pays for your medical treatment after you are  injured because of someone else&#8217;s negligence, Medicaid or Medicare  is entitled to reimbursement if you recover from the at-fault party. When  you settle a personal injury case, the IRS is entitled to tax certain  portions of total settlement amount. All of these factors can reduce the  bottom line for the client. It is part of the lawyer&#8217;s job to set  up the settlement in the way that is most beneficial to the client.<\/p>\n<p> In a recent article, &#8220;The Allocation of Damages in the Personal Injury  Lawsuit&#8221; by Robert B. Pearlman, Mr. Pearlman sets out some practice  tips for lawyers settling personal injury claims. <a href=\"https:\/\/www.sinklaw.com\/personal-injury\/\n\">Personal injury attorneys in South Carolina<\/a> must begin to factor the allocation of damages and not just their total  amount when settling cases. Amounts received by Plaintiffs as either awards  or settlements can be considered &#8220;income&#8221; by the Internal Revenue  Service. This was not the case prior to 1996. In order to reduce a client&#8217;s  tax burden on a particular settlement, attorneys should clearly lay out  the essence and nature of the claims and the purposes of the damages settlements,  which should be agreed to by the parties. <\/p>\n<p>The allocation of damages when a Plaintiff has Medicaid or Medicare is  especially important. A state Medicaid agency (like the South Carolina  Department of Health and Human Services) has statutory authority to recover  only from that part of an award or settlement that represents payment  for medical expenses, and not for other forms of damages such as pain  and suffering, lost wages, or loss of consortium.<\/p>\n<p> When negotiating a settlement for a client, an <a href=\"https:\/\/www.sinklaw.com\/car-accident\/\n\">injury car accident SC lawyer<\/a> should consider more than just maximizing his client&#8217;s recovery. Damages  should be allocated to different kinds of recovery like medical charges,  lost wages, pain and suffering, etc. This type of allocation will require  the agreement of the at-fault party. Plaintiff&#8217;s attorneys should  also put Medicaid\/Medicare on formal notice of settlement negotiations  and invite them to participate in the same when they believe that they  will not be able to satisfy the liens out of settlement proceeds. In South  Carolina, having the at-fault party deny liability through the settlement  process will be helpful. Plaintiffs attorneys need to allocate damages  in order to reduce tax liability for their clients and money that Medicaid  may claim as reimbursement. <\/p>\n<p><em>The information relayed in this blog is for educational purposes only and  is not legal advice. The cases referenced and explained by the blog&#8217;s  author(s) are for informational purposes only and are not intended to  imply that certain, or similar, results may be achieved in each client&#8217;s case.<\/em><\/p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Don&#8217;t Win Your Personal Injury Claim Just to Get Bitten Later On by Medicaid or the IRS<\/p>\n","protected":false},"author":65,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[21],"tags":[],"class_list":["post-339","post","type-post","status-publish","format-standard","category-personal-injury","entry"],"acf":[],"yoast_head":"\n<title>PI Claims &amp; Medicaid or IRS | George Sink<\/title>\n<meta name=\"description\" content=\"Don&#039;t Win Your Personal Injury Claim Just to Get Bitten Later On by Medicaid or the IRS\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.sinklaw.com\/blog\/dont-win-your-personal-injury-claim-just-to-get\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"PI Claims &amp; 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