The unexpected loss of a loved one can lead to unimaginable grief.
However, this tragic loss can cost you and your family in other ways as well.
If the victim contributed to your household, you are likely unprepared to cover their share of expenses or take on their household responsibilities after their death.
In California, certain surviving family members can file a wrongful death lawsuit to recover compensation for their losses incurred as a result of their loved one’s death.
Unfortunately, some families hesitate to file a wrongful death lawsuit because they do not understand the tax implications of receiving a wrongful death settlement.
We do not want the fear of tax liability to keep you from recovering the compensation you deserve.
Weinberg Law Offices has significant experience handling wrongful death lawsuits in California.
We can answer any questions you have about your California wrongful death claim, such as:
- What damages are available in a wrongful death lawsuit?
- Is a wrongful death settlement taxable?
- What does a wrongful death settlement compensate you for?
- Are wrongful death settlements considered taxable income?
Our team can answer these questions in addition to any others that come up during the process. We know that losing a loved one is not easy.
Our team can handle the stress of your wrongful death lawsuit while you focus on healing and spending time with family.
Contact Weinberg Law Offices today to start your free initial consultation.
What Is a Wrongful Death Claim?
Wrongful death claims arise when someone dies as a result of someone else’s negligent or wrongful act.
When this occurs, you can file a lawsuit against the party responsible for your loved one’s death to recover for your losses associated with the death.
Wrongful deaths can occur in almost any situation, but common causes include:
Any situation where someone’s wrongful or negligent act caused the death of your loved one can support a wrongful death claim.
If you want to know whether you qualify to bring a wrongful death action in California, contact Weinberg Law Offices today.
Is a Wrongful Death Settlement Taxable by the IRS?
As a general matter, no. The IRS does not tax wrongful death awards that consist of compensatory damages.
All damages available in a California wrongful death claim are compensatory.
Therefore, you do not need to pay taxes on a wrongful death lawsuit settlement in California.
However, you may need to pay some taxes on a settlement from a survival action.
A survival action is a claim brought on behalf of the deceased for medical expenses and lost wages they would have received.
A survival action is permitted only when the decedent did not die immediately after the accident. A survival action is brought by the decedent’s estate rather than their family members.
Unlike wrongful death actions, survival action awards can include both compensatory damages and punitive damages.
The judge can award punitive damages only if there is evidence of oppression, fraud, or malice by the responsible party.
Punitive damage awards are taxable. If you recovered punitive damages in a survival action, you do need to pay taxes on the punitive damage amount.
But you still will not need to pay taxes on any compensatory damages you receive.
Damages Available in Wrongful Death Cases
A wrongful death settlement compensates eligible family members for the financial losses they suffered as a result of their loved one’s wrongful death.
Thus, these are referred to as compensatory damages. Compensatory damages in a wrongful death lawsuit might include:
- Funeral costs;
- Loss of financial contributions from the decedent;
- The reasonable value of the decedent’s household services;
- Loss of love, support, and companionship; and
- Loss of guidance and advice.
The amount of a wrongful death settlement depends on the individual circumstances of the victim and their family.
Our team can help you determine what damages you might qualify for and what constitutes a fair settlement offer.
Contact us today so we can review your claim.
Need a Wrongful Death Attorney? Contact Weinberg Law Offices Today
The fear of paying a large tax fee should not prevent anyone from pursuing a wrongful death lawsuit. Even though wrongful death settlements are not taxable, some survival actions settlements are.
A qualified wrongful death lawyer from our team can help determine whether you need to pay any taxes on your settlement.
At Weinberg Law Offices, we offer free initial consultations and take cases on a contingency basis. That means you do not owe us anything unless and until we prevail in your case.
Our ultimate goal is to ensure you receive adequate compensation for your losses.
We can negotiate with insurance adjusters on your behalf, help calculate the damages you are owed, and advise you on how to fulfill your duties throughout the process.
Additionally, we will make sure we communicate with you throughout your case and keep you informed every step of the way. Every wrongful death case is different.
Some cases end in settlement, while others proceed all the way to trial. No matter what happens in your case, we will stand by your side every step of the way.
Contact Weinberg Law Offices today to get started.