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How to Prove Lost Wages After a Car Accident As a Self-Employed Person

Lost Wages After a Car Accident As Self-Employed

Losing income due to an injury can destroy a carefully balanced budget. If the injury is caused by a car crash, those injured can obtain compensation for the lost earnings . The good news is, if the person claiming did not cause the accident, compensation for lost income can be made by the self-employed. However, for the self-employed, providing evidence of financial harm is a different, more complicated process than for hourly employees working for a company. Here is a guide to proving lost wages and gaining compensation when you’re self-employed in Arizona.

Are You Self-Employed or an Employee?

Claiming lost income for the self-employed is different from making a claim as a regular employee. Simply put, a self-employed person works as an independent contractor, a freelancer, or the sole proprietor of a business. He or she controls the time and place of work, unlike employees who work whenever and wherever their employer tells them to.

What Does “Lost Wages” Mean for the Self-Employed?

“Lost wages’’ means lost income, compensation, and benefits—in other words, the money you would reasonably have earned had the car crash not prevented you from working. For the self-employed, this money includes recent profits, unfulfilled contracts, lost business opportunities, and even damaged customer confidence, if they are quantifiable. 

How to Prove Loss of Income and Wages if You Are Self-Employed.

Proving loss of income and wages for the self-employed is much more tricky than proving the loss for hourly employees. Without evidence of lost financial gain, you can’t receive compensation for the loss. Because of this, gathering the appropriate evidence in support of your claim to the insurance adjuster or court is crucial.

What is Appropriate Evidence?

Here is the evidence you must provide to prove your self-employed lost wages claim:

  • Evidence of lost wages and business opportunities: To prove the amount of money you reasonably have been expected to make from the time the injury occurred until you can return to work, you will be asked to supply your tax return and 1099(s) from the previous year. Receipts, invoices, and correspondence regarding current and imminent work prospects will help build a case for lost earnings during the time you are incapacitated.
  • Details from those who employ you: Written documentation from employer, supervisor, or office will help to build your case. It should include proof of your identification, the status of your employment, your compensation, and how many hours your recovery from injury caused you to miss.
  • Medical records: You must supply documentation that proves you are medically unfit to work. This can take the form of a doctor’s note or an official disability document that details the specifics of your injury and recommends you take a specified time off from work to recover.

How to Calculate Lost Wages When You Are Self-Employed

Any time off work must be reasonable to the nature of injuries sustained in the accident. If prior to the accident business or contracted employment has been regular, damages can easily be calculated using last year’s tax return. On the other hand, if your work is not regular or involves increasing profits or other benefits, hiring an attorney who specializes in personal injury or a forensic economist may be the best option for you.

Attorneys Can Help the Self-Employed Prove Lost Wages After a Car Accident

As a self-employed person, proving you have lost wages and other income after a car accident can be a difficult task. Irregular work or working for more than one employer can make gathering the necessary proof of loss tricky and time-consuming.  Mistakes may result in the denial of your claim.  

If you are looking for assistance in documenting your lost income after a car accident in Phoenix, AZ, our experienced car accident attorneys are here to help. Give us a call, today!

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