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Insurance settlement

Discussion in 'Auto Accidents, Injuries' started by Chad1331, Sep 27, 2019.

  1. Chad1331

    Chad1331 Law Topic Starter New Member

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    Jurisdiction:
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    My mother was in a horrible accident that was not her fault. The insurance company finally sent her a check to pay for bills. No attorneys were involved.
    All bills have been settle and there is money left. Does she need to return this money or is it hers? If she keeps it, does she need to claim taxes on it?
     
  2. army judge

    army judge Super Moderator

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    She should ask the insurance company.

    There is no way strangers would know anymore than she does.


    Again, soliciting such important tax advice from strangers who know less about her tax picture than you or she might is foolish.

    She could ask her attorney or her CPA, but don't take IMPORTANT legal or tax advice from strangers who just might be less informed than you.
     
  3. Chad1331

    Chad1331 Law Topic Starter New Member

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    I understand. I contacted my CPA and thinks the money is hers and does not need to be repaid. But he suggested contacting an insurance agency.
     
  4. zddoodah

    zddoodah Well-Known Member

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    Whose insurance company? Hers? The other driver's? Which bills is this check for? Did the insurer send the check pursuant to a release signed by your mother? Has she negotiated the check (i.e., cashed or deposited it)?

    It is extremely unlikely that she needs to return the remaining $$.

    Depends on what the money was for -- in particular, whether any portion of the check was for lost wages.
     
  5. Chad1331

    Chad1331 Law Topic Starter New Member

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    It was from his insurqnce company I believe. It was to pay the bills, such as the helicopter ride, drs and hospital, etc.

    Everything is now paid. And she has money left.

    My mother did sign a couple of forms allowing her insurance company to "represent" her.

    She is retired, so no lost wages. Car was totaled though. But I believe the car was already compensated in a seperate check.






     
  6. adjusterjack

    adjusterjack Super Moderator

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    Yeah, there is a way. There's me.

    I'll go out on a limb here with my 35 years experience in the insurance industry.

    1 - She doesn't have to give any of the money back. Anything above her actual expenses is for her pain and suffering and hers to keep.

    2 - The settlement is neither reportable nor taxable since there was no loss of income involved.
     
  7. Chad1331

    Chad1331 Law Topic Starter New Member

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    Awesome! Thanks so much for replying!
     
  8. zddoodah

    zddoodah Well-Known Member

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    If this was for medical bills and property damage and no portion was for lost wages/income, then there's nothing reportable for tax purposes. If it was paid pursuant to a settlement agreement that says the other driver's insurance company pays $X, then there's no obligation to return the amount in excess of the bills.

    In other words, I fully concur with "adjusterjack."
     

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