Georgia Truck Accident Lawyers Blog

This blog will continue in our series of providing our readers with answers to frequently asked questions in the context of a serious injury case. This blog will address FAQ number 4:

4. If I obtain a settlement from the at fault defendant, do I have to pay taxes on my settlement?

Answer: Restitution for a loss is not considered to be income. According to the majority view and interpretation of current IRS law, if an injured individual obtains a settlement from an at fault third party, that settlement is not taxable. There are exceptions to this rule, however, with respect to punitive damages. If a jury returns a verdict for punitive damages in addition to compensatory damages, the punitive damage portion of the verdict is taxable. To date, most experts seem to agree that any verdict returned in a personal injury case is not taxable absent a verdict for punitive damages as well. This is the general view of the tax laws as pertains to personal injury settlements. While different variations of a claim could subject a particular claim to taxation, most tort claim settlements are not taxable because the monies obtained in settlement are not considered to be income by the IRS but rather are considered to be restitution for a loss, something by definition separate and distinct from traditional forms of income.

As personal injury attorneys who handle many cases involving very serious injuries, we are frequently asked questions by clients and family members about matters commonly of concern to them. In order to provide our readers with some general guidance about serious injury cases in Georgia, we have decided to do a series of blogs on frequently asked questions in the context of such cases. This entry shall address the first of many of such questions, with future blogs on other FAQs to follow.

1. Who pays for my medical bills while I am recovering from my injuries?

Answer: You do. In Georgia, we do not have a “Pay As You Go” rule. In a hypothetical automobile accident where it is admitted that the other driver is at fault, there is still no duty of that driver or his insurance company to pay medical expenses for the injured victim as they are being incurred. Instead, the injured individual is required to use his or her own resources to pay for medical expenses as they are being incurred. If the expenses incurred exceed available insurance coverage, the insurance carrier for the at fault driver may decide to tender available coverage without further delay, but there is no legal requirement that they do so. However, if the medical expenses being incurred do not exceed available coverage, typically, such bills will not be paid until all medical reports are made available for review to make sure that the incurred medical expenses are related to the injuries caused in the hypothetical collision. Thus, in Georgia, as in many other states, it is imperative that the public protect itself through health insurance where it is possible to do so for budgetary and other reasons. If someone does not have health insurance, it then becomes difficult to obtain necessary medical treatment after one has been injured. Nonetheless, the at fault driver and its insurance carrier do not have to pay for necessary medical treatment after an accident, rather, the injured individual must pay for his or her own treatment and then seek reimbursement from the at fault driver and insurance carrier for those expenses later.

Another way that the public can protect itself is to purchase as part of their own automobile insurance policies what is known as Medical Payments coverage. Medical Payments coverage is paid regardless of fault if such medical expenses are incurred as a result of an automobile accident. Even without health insurance coverage, the public can protect itself by purchasing Medical Payments coverage as a part of their own automobile liability insurance policy. While all drivers are required to purchase minimal amounts of liability insurance coverage to protect other drivers, the public may protect itself through Medical Payments coverage which can pay medical expenses up to the limits of such coverage regardless of fault provided the expenses are proven to have arisen out of an automobile accident. This coverage can be important in serious injury cases because if the injured individual does not have other available health insurance then the medical payments coverage can pay medical expenses as they are being incurred, regardless of fault.

Our truck accident attorneys constantly handle cases involving dangerous trucks and tractor-trailers on the highways. Now, it appears even more dangerous trucks will begin appearing on the U.S. highways after the Bush Administration last week opened the roads of this country to another Mexican trucking firm. There are now 12 Mexico based trucking carriers which have been granted authority to operate in the United States.

The consumer interest group Public Citizen has issued a strong condemnation of this action taken under a provision of the NAFTA treaty which has started to allow large trucks and tractor - trailers open access to U.S. highways. Through its President, Joan Claybrook, former administrator of the National Highway Traffic Safety Administration, the organization issued the following statement:

Today, the Bush administration spat in the public’s face by allowing full access to U.S. roads to yet another Mexico-based carrier — despite Congress’ clear intent that the reckless NAFTA trucking pilot program be brought to an end.

The Federal Motor Carrier Safety Administration (FMCSA) announced today that the Baja-based carrier Madereria Las Lomitas is now authorized to send a truck throughout U.S. roads. That means 12 Mexico-based carriers are now sending 57 trucks across the U.S. and are no longer restricted to the border zone. This announcement comes on the heels of the administration’s shocking statement that it would continue with the NAFTA trucks pilot program even though President Bush last month signed into law an omnibus appropriations bill that cut all funds for the program.
FMCSA’s purposeful defiance blatantly disregards the newly passed federal law. The appropriations provision prohibits using any funds to “establish” a pilot program. The dictionary’s definition of “establish” includes “to introduce and cause to grow and multiply.” FMCSA has told reporters that the law bars only the “establishment” of new pilot programs and that its current pilot program — the exact same one that prompted Congress to cut off funding — was “established” in September 2007. Yet FMCSA continues to authorize new carriers, further “establishing” the program in any meaning of the term.

This dubious interpretation isn’t just tortured logic — it’s a willful repudiation of the clear intent of Congress to end this pilot project. Congress has repeatedly and overwhelmingly denounced the flawed program as dangerous and unjustified. The Bush administration’s insistence on pushing forward, despite requirements to put the public’s safety first, forced Congress to cut funding for the project.

It is absolutely unacceptable for the administration to pick and choose the laws it will respect. FMCSA has no basis to ignore this law and in doing so shows it has no regard for the well-being of American drivers.