Colorado car accidents never quite meet their victims prepared. One moment you’re running to beat the rush hour to work, and the next, you’re in a car crash, looking at an extended absence from work and a lot of lost wages.
In many ways, this is one of the worst things that a car accident can do to you. If you are lucky to escape with your life and only minor injuries, you can get back on track pretty quickly. But if you have more serious injuries, the accident can take away your ability to earn a living.
No person should have to watch all their work go to waste. Under Colorado law, if you were involved in a car accident that was not your fault and had to stay away from work, you are entitled to compensation. The law allows you to file a lawsuit to claim lost wages for the period you were unable to work.
Going about making your claim can often be a tricky affair though. Unlike a claim for your medical or other expenses, proof of lost wages can be pretty difficult. To give yourself the best chance of securing the positive outcome you desire, you would often have to rely on a qualifies Colorado car accident lawyer.
At Malman Law Firm, we have distinguished ourselves as one of the best Colorado personal injury law firms. We have helped many clients like you to recover lost wages after being involved in car accidents. If you would like to talk to our lawyers about a possible claim for lost wages, please call us on (303) 733-7900 to book a free consultation.
What kind of ‘wages’ can you recover compensation for?
There is often a fair amount of confusion as to what exactly amounts to wages. Many do not understand what they can claim for as lost wages in a personal injury lawsuit and what they cannot claim for.
Wages ordinarily include all amounts you would have been entitled to receive from your workplace if you had not been injured. It is not limited to only your basic salary, but also your bonuses, commissions and even amounts that you reasonably expected would have come to you during the period.
For instance, if you were earning $15 per hour as at the date when you got injured in the car accident, you can claim for that amount. You can also claim for the extra $5 bonus you get for putting in a full shift every day or even the extra $10 per hour you would have got from overtime work.
It is important to note that to recover for lost wages, you do not necessarily have to be in regular employment. This means that you are not barred from claiming lost wages even though you are self-employed.
If you work in an establishment where you regularly get tips, it is possible for you to claim lost wages for all the tips you would have earned. The bottom line is: lost wages include any amount you would legitimately have earned if the car accident had not happened.
Are lost wages different from lost earning capacity?
Yes. Lost wages are plenty different from lost earning capacity. While lost wages cover what you would realistically have earned during the period you were injured, lost earning capacity looks forward.
It anticipates the reduction in earning capacity that has been caused to you due to the accident. For instance, if you were able to work 8 hours a day before the accident but can now only work for 5 hours a day, you have lost in earning capacity. Under the law, you would be entitled to claim compensation for all those extra hours you would now be unable to work for.
So, while lost wages cover what you would have earned, lost earning capacity covers what you can no longer earn. Note though that proof of lost earning capacity is usually more difficult than proof of lost wages. It would often require bringing evidence by medical or occupational experts to show the loss you are incurring.
How to prove lost wages for various sources of income
In order to obtain compensation for lost wages in Colorado, you have to provide proof of the earnings you have lost. This proof is relatively straightforward if you were injured for a short period and what you are claiming is only your hourly rate.
But when you are claiming for things like lost performance bonuses, lost tips or lost opportunities for career advancement, things can get tricky. If you are trying to recover compensation for a raise you were reasonably expecting before the accident, or even a promotion, you must provide clear proof.
In order to fully discharge the burden of proof required in these instances, you may have to retain the services of experts. This can include forensic accounting or occupational experts. They will help show your career or business trajectory before the accident and provide convincing proof of what you have lost.
Generally, you can make your claim for lost wages using any of the following ways:
- Lost wages letter: A letter from your employer indicating your salary at the last rate before your injury is great proof. It is also one of the easiest ways through which you can prove lost wages. The letter should contain your job title, date on which you were hired, your hourly rate at last raise and overtime rate you were entitled to. It is useful to include any other items you need to prove your lost wages in this letter.
- Past pay stubs: If it is difficult for you to get a letter from your employer, your past pay stubs can also provide the proof you need. If you have not kept any copies of your pay stubs or if what you have is incomplete, your Colorado car accident lawyer can obtain copies for you.
- Past tax returns: Your past tax returns also provide convincing proof of your income. In fact, it may be one of the best forms of proof. You can use IRS Form 4506 to request for copies of your past tax returns from the US Internal Revenue Service.
- Proof of lost self-employment income: As a self-employed individual, proof of lost wages can be difficult since you don’t have pay stubs. You can however prove your income with the use of your past tax returns or your billing statements. If your income is very complicated, you may need the services of a forensic accounting expert to provide proof.
- Personal, sick days and vacation time: If it is possible to monetize benefits such as sick days and vacation time at your office, you can claim for them too. You would however need to prove that you lost that time due to the accident injuries.
- Overtime, commissions and bonuses: Since this type of income is more speculative than clear hourly rates, they need a bit more proof. You can ask your employer to include details of what you earn from these sources in your lost wages letter. You can also support that with your past pay stubs that show a pattern of overtime pay or bonuses.
- Proof of income from tips: This can be a very difficult one to prove. You may ask your employer to include details as to tips you usually earn. But one of the best ways to convincingly prove this is by private investigator visits to your workplace.
Will the compensation recovered for lost wages be subject to tax?
In theory, yes. Since the lost wages would have been taxable if you had earned them, they should still be taxable when recovered in a lawsuit. In order to be certain though, you need to consult with your personal injury attorney.
It is important to note that proving income that you never declared on your tax returns could expose you to back taxes by the IRS. So you need to let your lawyer know all the facts before the time for proof.
Contact us for your lost wages claim
If you are contemplating a lost wages claim, you can significantly increase your chances of a positive outcome by contacting us. Our lawyers at Malman Law Firm have deep experience in personal injury cases just like yours. Our unique skill and experience in this area has helped us win big money verdicts and settlements for our clients.
Take advantage of our free no-obligation consultation to tell us your story today. Call us on (303) 733-7900 to start a conversation today.