Two Types of Income Loss Claims
Personal injury claims can include two types of income-related damages: past lost wages (income you already lost while recovering from injuries) and future lost earning capacity (income you will lose going forward because of permanent impairment or reduced work capacity).
Documenting Past Lost Wages
- Pay stubs and W-2s showing pre-injury income
- Employer letters confirming missed work and the reason
- Tax returns for self-employed claimants
- Business records showing lost business income if self-employed
- Medical records establishing the period of disability
Lost Earning Capacity
Lost earning capacity applies when injuries cause permanent limitations that reduce your ability to work at the same capacity as before. A vocational expert may assess your pre- and post-injury work capacity. An economist may calculate the present value of future lost earnings. This can be a significant component of catastrophic injury claims.
Self-Employed Claimants
Documenting lost income is more complex for self-employed individuals, freelancers, and business owners. Tax returns, business records, client contracts, and testimony about lost business opportunities help establish this claim. Insurance companies scrutinize self-employment income claims carefully.
Household Services
If injuries prevent you from performing household services you previously provided (cleaning, childcare, yard maintenance), the replacement cost of those services may also be recoverable. Keep records of any services you had to hire out as a result of your injury.
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InjuryClaimSource is an educational resource. We are not a law firm and do not provide legal advice. Consult a qualified personal injury attorney for advice about your specific situation.