Bankruptcy and Workers Compensation
Workers compensation benefits are funds made payable to an individual
who was injured while on the job and unable to perform their duties due
to the injury. The compensation may be considered a main source of income
for the household. If bankruptcy is an option it is common to wonder if
benefits can be protected from creditors, and will they continue receiving
them during the course of the case. For the most part, filing for bankruptcy
will not interfere with your ability to continue receiving benefits. In
short, your benefits qualify for protection.
Workers compensation benefits are often calculated based on wages earned
before the injury occurred. Yet, when you file bankruptcy you are required
to report forms of income your household receives to determine eligibility.
Most states allow workers compensation benefits to be exempt, meaning
they qualify for protection under exemptions provided through bankruptcy.
If you are expecting to receive workers compensation benefits after you
file bankruptcy, it is important to mention the possibility upon beginning
the filing process. Meaning, if you have a settlement pending and decide
to file for protection, discuss your situation with you attorney before
your settlement becomes final. Failing to mention a potential settlement
that has yet to occur prior to filing could jeopardize the outcome of
your case.
You can file
Chapter 7 or
Chapter 13 bankruptcy. If you qualify for a repayment plan under Chapter 13 monthly payments
are determined by household income and prior debts that are required to
be repaid.
Considering Bankruptcy? We Can Help You
If you need assistance in determining if bankruptcy is right for you,
you can always reach out to us. To set up a free consultation you can
give us a call or simply fill out our
contact form.