Helpful Articles
Dividing a Wrongful Death Settlement
When a wrongful death claim is successful, the family of the deceased will receive a settlement from the defendant or their insurance company. This settlement is intended to compensate the family for their losses and damages.
However, dividing a wrongful death settlement can involve a lot of money. It can be complex and contentious unless the case is resolved by a verdict, setting forth each wrongful death beneficiary’s damages. Here are some important factors to consider when dividing a settlement:
The Deceased's Will or Estate Plan for Survival Claims
If the deceased had a will or estate plan, it may outline how their assets and settlements should be divided among their beneficiaries. In this case, the survival claims of the estate may be divided according to the instructions in the will. If no will exists, look to state law for guidance on the distribution of claims of the estate.
The Relationship Between Beneficiaries
In some cases, the relationship between beneficiaries can complicate the division of a wrongful death settlement. For example, if the deceased had a spouse and children from a previous marriage, there may be tension between the spouse and children over how the settlement should be divided.
In these situations, it may be helpful to seek the guidance of a mediator or attorney to help facilitate a fair and amicable division of the settlement.
In Texas, for a wrongful death claim, damages are awarded based on each wrongful death beneficiary’s loss. So the closer the relationship, generally the larger the damages. As an example, if a wrongful death lawsuit is filed by the surviving spouse and the parents of the deceased spouse, the surviving spouse’s damages probably are much larger.
Tax Implications
Considering the tax implications of dividing a wrongful death settlement is important. In general, settlements for wrongful death claims are not taxable at the federal level. However, some states may have different laws regarding the taxation of settlements.
Additionally, these amounts may be taxable if the settlement includes interest or punitive damages. It's important to consult with a tax professional to understand the potential tax implications of dividing a settlement.
Tips for Dividing a Wrongful Death Settlement
If the case settles, the family usually agrees on how to divide the money. Sometimes, family members are represented by separate wrongful death attorneys. Those attorneys may negotiate a division. However, dividing a wrongful death settlement can be difficult and emotional. Here are some tips to help navigate this challenging situation:
Communicate Openly and Honestly
Communication is key when it comes to dividing a wrongful death settlement. It's important for all parties involved to communicate openly and honestly about their needs and concerns.
It may be helpful to have a family meeting or to work with a mediator to facilitate these discussions. This can help ensure that everyone's voice is heard and that the division of the settlement is fair and equitable.
Seek Professional Guidance
Dividing a wrongful death settlement can be a complex legal process. It's important to seek the guidance of a qualified attorney with experience with wrongful death cases.
An attorney can help you understand your rights and responsibilities and the laws in your state that may impact the division of the settlement. They can also help mediate disputes and ensure the settlement is divided fairly and legally.
Consider the Deceased's Wishes
If the deceased expressed any wishes or preferences for how their assets should be divided, it's important to consider these when dividing a wrongful death settlement. This can help ensure that their wishes are honored and that the division of the settlement is in line with their desires.
Conclusion
Dividing a wrongful death settlement is a difficult and emotional process, but it's important to approach it with care and consideration. By understanding the legalities of wrongful death claims and seeking professional guidance, you can navigate this challenging situation and ensure that the settlement is divided fairly and equitably among all beneficiaries.
