Our Personal Injury Lawyers in Greenville, South Carolina Explain Settlement Checks
After you have been injured in a car crash, a fall, or another type of negligence incident, you may be entitled to compensation. Our personal injury lawyers in Greenville, South Carolina know that a monetary recovery could occur at various different times throughout a case. According to statistics, the most common way that a recovery tends to happen is through a settlement check – with roughly 97% of all civil cases resulting in a pre-trial settlement. This rate has historically risen over the years, making a settlement the most common way that a lawsuit is resolved. Despite the fact that settlements can occur at many different points throughout a case, they are never guaranteed. Sometimes a settlement occurs pre-litigation, whereas other times it will happen in the middle of a case after a judge denies a motion for summary judgment/to dismiss (keeping the case alive). But most commonly, a case will settle right before a trial even begins.
Once a settlement occurs, the next question most people ask is who will receive a part of that check. Here at the Hammack Law Firm, our experienced personal injury lawyers know that our work is not done until after we obtain a settlement for a client. Many other entities or individuals may want to cut into your check, but our bodily injury firm will help you to protect what is rightfully yours.
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Who MIGHT Be Entitled to a Part of That Check
With the exception of the agreed-upon legal fees from your settlement check, there are very few other instances where you may have to split a part of it. It is important to realize who may be entitled to compensation, and who may not in order to maximize your net recovery.
Below is a list of some entities or individuals who may be entitled to a portion of your settlement check.
1. Medicare or Medicaid
A lien is defined as, “a right to keep possession of property belonging to another person until a debt owed by that person is discharged.” Any type of CMS (Centers for Medicare & Medicaid Services) lien is a type of lien that must be repaid, and they will often hold your attorneys responsible if it does not get paid. Unfortunately, settling a CMS lien can take a good chunk of time to resolve, which is why having an experienced personal injury lawyer like us to get the CMS lien process started– even before a settlement occurs – can help to expedite your recovery.
2. ERISA Liens
Health insurance companies that pay for injuries in an accident may try to assert an ERISA lien, part of a federal law. However, only certain types of ERISA liens may require reimbursement, and most times the carrier will result in reimbursement even if they are not entitled to it. Unfortunately, there are times when an ERISA lien may be proper, and thus having an experienced personal injury lawyer on your side can help screen out imposters and pay out truthful liens.
3. Workers’ Compensation Liens
If you were injured in a work-related accident and received workers’ compensation benefits but were able to go after a third party, you may have a workers’ comp lien to settle. Keep in mind that this type of lien will almost always require reimbursement from your own funds. It is not just the carrier, but also public monies since the state subsidizes/monitors WC plans. However, the good news is that an experienced personal injury lawyer can often fight to have this lien reduced, helping you to pocket more money.
4. Child Support Arrears/Liens
Although not always applicable, a child support arrears judgment or order may warrant a portion of your settlement check to be immediately paid to the lien holder – whether that be the State in an enforcement action or another parent or guardian of your child.
5. Plaintiff’s Lien Services
After a personal injury accident, it may be incredibly difficult or even impossible to earn money due to injuries. Medical bills may also be debilitating. There are loan servicers that take out plaintiff’s liens, meaning they will front money to a personal injury victim but take a percentage of the recovery – often at an unscrupulous rate that is too high. We strongly discourage the use of plaintiff lien services, although we acknowledge they may be necessary for some families. These entities may be required to get a portion of your settlement check, which can sometimes be negotiated downwards.
6. Bankruptcy Trustees
If you are in either chapter 7 or chapter 13 bankruptcy, a trustee may have possession over your assets. This includes litigation interests such as a personal injury claim. Although you may be entitled to recover compensation in a personal injury lawsuit, you may have to sign over a portion of your settlement check to the bankruptcy trustee.
These are just some of the most common examples, even though there still may be other instances that you should discuss with your personal injury lawyer.
Who is NOT Entitled to a Part of That Settlement Check
Now that the bad news is over, let’s review who cannot get a portion of your settlement check in South Carolina. This list is by no means exhaustive, but nevertheless, we’ve mapped out some of the most important examples for you.
1. The IRS
Yes, let’s go right for Big Brother first! Even the corporate overlords themselves cannot obtain a portion of your settlement check except in ultra-rare cases… like, we’re talking rarer than a first-edition Charizard card rare. The only exceptions to this would be instances where your settlement includes lost wages, which a good personal injury lawyer would never allow.
2. State Taxes
Okay, this should have been obvious that if the biggest, baddest debt collector in the world (aka the notorious IRS) wasn’t entitled to your settlement check, then the state tax authority also cannot receive any dividends from it. With limited exceptions, you won’t have to pay any portion of your personal injury settlement to taxes.
Unless there are child support liens, and even rarer, spousal support liens, then a personal injury settlement is considered “separate property.” This means that it belongs to that individual person and that it cannot be paid out to the other spouse or an ex-spouse.
4. Mortgage or Credit Card companies
Even if you are behind on mortgage payments or credit card bills, your personal injury settlement cannot be taken away from you by debt collectors. It is your choice, and yours alone, to decide how to pay your debts.
5. Scammers For Car Warranties, House Warranties, Refrigerator Repairs, Or Computer Repairs
Although this sounds silly because we all get fake car warranty calls, the truth is that your settlement is often public record. That means, unfortunately, untrustworthy folks may try to recover compensation from you through deception and fraud. You must be careful after you have your settlement because some individuals and criminals will target personal injury victims and try to obtain settlement proceeds through trickery with scams. When in doubt, ask your lawyer or call the local police department, postal inspection service, or another law enforcement entity to explain what has happened and whether it is legitimate.
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Have Questions Who Can Get Your Settlement Check? Our Personal Injury Lawyers Have the Answers
Knowing your rights is important after an accident. This means more than just knowing what types of compensation you may be entitled to, but also who may obtain a portion of your settlement check. If you or a loved one were injured in a car crash, a slip and fall accident, or another type of wreck, collision, or negligent incident, call our compassionate personal injury lawyers in Greenville, South Carolina at the Hammack Law Firm for help.
We can answer more than just your legal questions relating to your lawsuit, including your rights to your settlement proceeds. To learn more, please call and schedule your free consultation with our compassionate and experienced bodily injury team at the Hammack Law Firm.