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When a Wisconsin Personal Injury Attorney settles a case for a minor: March 31, 2008

Posted by Attorney Jonathan Groth in FAQ Personal Injury.
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Tomorrow I’m appearing for a child who was severely injured in a motor vehicle collision in Wauwatosa.  I think it’s important to understand how minor settlements work.

When someone under 18 (minor) is injured in an auto accident, dog bite, slip and fall, product liability etc. and the case is settled before a suit is filed it is the INSURANCE COMPANY’S choice to have the settlement approved by a Circuit Court Judge.  Why?  Because the insurance company wants the personal injury settlement to be finalized.  They want to close their file.  It doesn’t want the minor to come back when he/she turns 18 and file a lawsuit with an attorney and ask for additional money.

What does a minor settlement mean for the minor?  Well, the minors settlement funds have the added protection of the State.  Adults shouldn’t be able to dip into the settlement without a hearing before a Judge and a court order.   But, in many cases the insurance company refuses to pay the court filing fees.  So, the minor gets less money in their pocket.

The reason I mention all of this is the tax ramifications of it.  From what I’m told it’s important that the lawyer that settles the case NOT put the funds into his/her attorney trust account or anyplace else for that matter.  The personal injury settlement funds need to be sent from the insurance company directly to the annuity company that will be handling the disbursement of the funds.  

Just a little attorney to attorney advice for what its worth.  If you’d like more information contact me at www.jonpgroth.com

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1. Breed Specific Legislation: Death and Disability by Dogs Breeds Contempt — Affordable insurance - April 7, 2008

[…] the funds into his/her attorney trust account or anyplace else f or that matter…. source: When a Wisconsin Personal Injury Attorney settles a case for a minor:, Jon Groth’s […]


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