A lawsuit settlement is a monetary payment you receive in exchange for suffering some kind of injury. People can recover a monetary settlement after suffering injuries in the following:
- Car accidents,
- Truck accidents,
- Bicycle accidents,
- Workplace accidents,
- Slip and fall accidents, and
- Product liability accidents.
The settlement is designed to reimburse you for things like medical bills, lost wages, and loss of future earning capacity.
However, child support obligations can reduce the value of your overall personal injury settlement if you need to catch up on payments.
Many of our clients want to know, If I win a settlement, can child support get it? The amount of child support deducted from a settlement depends on several factors.
Is a Settlement Considered Income for Child Support Calculations?
The court determines how much child support a non-custodial parent pays by reviewing their income and applying the state guideline percentage for the number of children they support.
Then, child support is withheld from their paycheck and distributed to the custodial parent each month.
Typically, a personal injury settlement will not alter your child support obligation. The personal injury settlement is meant to reimburse you for past and future losses inflicted by your accident.
However, you still need to report the personal injury settlement as income on your state and federal tax returns. A large settlement may influence the family court judge to modify your child support obligation.
In most cases, personal injury settlements are issued in a lump sum payment. Occasionally, they are issued in structured payments.
In the latter scenario, you need to include the settlement payments on your income tax as long as you receive them.
How Much Can Child Support Take from a Settlement If I Am Behind on Payments?
The state can garnish funds from your personal injury settlement if you are behind on child support payments. The amount a state can garnish from your settlement varies from place to place.
In most states, they can garnish the entirety of your settlement to satisfy past-due child support payments.
The state can also garnish your income, tax refunds, and bank accounts to satisfy back child support obligations.
How Does the State Know About My Settlement?
When one party is behind on child support payments, the custodial parent can notify the appropriate child support enforcement agency.
The agency will obtain a child support lien against any settlement the noncustodial parent receives.
How to Avoid Getting My Settlement Garnished for Child Support Payments
The state will only garnish your settlement funds before you receive them if you are behind on your payments.
If you contact the child support enforcement agency about your delinquent payments and set up a payment plan, you can get out of delinquent status.
In some cases, it is worthwhile to delay a final settlement until you are current on child support payments.
Contact Injury Wallet to Discuss Your Child Support Obligations and Personal Injury Settlement
Child support obligations can impact your portion of a personal injury settlement check if you fall behind on payments. One way to keep up with your payments is by securing pre-settlement funding.
Injury Wallet can help you avoid the hassle and stress of locating a lawsuit loan company. Let us handle the heavy lifting by finding lawsuit loan companies with the lowest rates.
