Can You Sue for Loss of Income After a Car Accident?

How is My Existing Loss of Income Calculated in California?

Existing loss of income is calculated in your personal injury suit by adding all the wages that you’ve lost since the car accident. When calculating the amount, our best car accident lawyers in San Diego say you need to be sure to add in benefits like health insurance that you usually receive from your employer.

When calculating lost income, consider your gross earnings only, so look at the amount before taxes and other deductions are taken out. For example, if you make $700 gross income each week and you were out of work for one month due to your car accident injuries, then you’re entitled to a $2,800 payment for lost income.

What Documents Prove Loss of Income in a Personal Injury Suit?

Generally, an experienced personal injury attorney in San Diego uses your most recent wage statement or pay stub to detail your regular income. Alternately, a letter from your employer may be enough as legal documentation, as long as the letter includes:

• Your position,
• Pay structure, and
• How long you were out of work.

If you don’t have a full-time job working 40 hours a week, additional documentation, like a tax return, might be required to calculate your average weekly income value.

If a significant portion of your income comes from receiving tips, further documentation proving your credit card tips can be used to document your income loss. When most of your tips are cash-based, your tax return from the previous year will most likely be used to document your wages. However, the caveat is that you’ve been claiming your cash tips, so your tax return reflects your real income.

How is My Future Loss of Income Calculated in California?

Any future loss of income derived from your car accident injuries caused by an at-fault driver is also added to your claim’s valuation. Your car accident attorney will seek expert medical opinions and testimonies about your incapacity to work in the future to calculate this amount. For example, if a medical expert expects you to be out of work for six months, your injury claim will include six months of lost income in the valuation.

If your injuries are significant and you’re facing long-term disability from them, your lifelong earning capacity may be impacted for years to come. If you worked in construction, for example, and suffered a long-term spine injury from lifting heavy objects, you may never be able to work in that same position again. If your loss of physical ability requires you to take a lesser paying job, your injury claim can factor in the difference between your previous earning capacity and your current earning capacity.

Some injuries that prevent an accident victim from returning to work are not physical but can be psychological and mental or emotional difficulties, such as anxiety or post-traumatic stress disorder (PTSD). If that disorder affects your working ability, you can claim future loss of income in your injury suit.

Can I Sue for Loss of Income if I’m Self-Employed?

If you’re self-employed, you still have the right to recover compensation for loss of income. The biggest challenge is demonstrating your historical average salary with sufficient documentation. Your car accident lawyer may use the following documents to prove your loss of income as a self-employed worker:

• Two years of previous federal income tax returns
• Accounting records if you bill your clients monthly
• Calendars showing the average number of appointments
• Existing contracts for jobs uncompleted due to your injuries

You may also be able to recover compensation for lost opportunities if you’re self-employed. Your lawyer will usually require more detailed documentation to add lost opportunities in the value of your claim.

Entrepreneurs and business owners can usually have their accountant provide documentation to demonstrate average business volume before and after your injuries occurred from your accident. Bank statements of your business accounts can be used as supportive evidence.