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  • Writer's pictureRobert Schuerger II

Are Wrongful Death Settlements Tax Deductible in Ohio?

The question of whether wrongful death settlements are taxable is one that often confuses plaintiffs seeking justice. However, the answer isn't as black and white as many like it to be.

People usually pursue a wrongful death claim when a tragic accident results in the untimely death of a person. This could be due to the negligence or intentional act of another party.

Wrongful death settlements seek justice for the victim's family by holding the responsible party accountable.

This monetary amount also provides compensation for their losses. The Internal Revenue Service (IRS) doesn't typically tax compensation for personal injuries.

Are All Wrongful Death Settlements Taxable in the US?

Are All Wrongful Death Settlements Taxable in the US?

In Ohio, wrongful death claims are nontaxable, just like in many other states. The idea is to provide financial relief to the victims and their families without having to pay taxes on the compensation meant to ease their suffering.

Still, the court does not treat all elements of a wrongful death claim similarly. While the core amount is usually tax-free, other damages (if awarded) may be subject to taxation.

Navigating the complexities of wrongful death claims, especially when it comes to the tax implications, can be challenging. This is where a knowledgeable wrongful death attorney becomes an invaluable resource.

They can help victims understand the nuances of their specific case, ensuring they receive the compensation they deserve without any tax surprises down the road. Schuerger Shunnarah Trial Attorneys can help with situations like How do I divide a wrongful death settlement in Ohio?

Who Can File a Wrongful Death Claim in Ohio?

The pain of losing a loved one due to any circumstances is immeasurable. In such tragic moments, survivors need to understand who is eligible to seek justice through a wrongful death claim. Certain people can file a wrongful death case on behalf of the deceased. These parties typically include:

  • Surviving Spouse 

The first person in line is usually the surviving spouse. They have a legal standing to seek damages for the loss of their partner. However, ex-partners who legally married someone else before the untimely death of the victim cannot file wrongful death cases.

  • Dependent Children 

If there is no surviving spouse or the partner does not pursue a claim, the children of the deceased may step in. In Ohio, biological, adopted, and stepchildren can file a wrongful death case.

  • Parents 

If the deceased person had no surviving spouse or children, their partially or fully dependent parents can seek a wrongful death settlement. This is relevant in cases involving younger people or unmarried adults.

  • Personal Representative 

There are instances where none of the above parties pursue a wrongful death claim within six months. In such events, the court can appoint a personal representative to take legal action on behalf of the deceased's estate.

Common Damages in a Wrongful Death Settlement

In the wake of a wrongful death, the grieving process is not just emotional but often financial as well. Whether it's a spouse, parent, or guardian, the deceased's income and support were instrumental in maintaining the dependent's quality of life.

Financial Support

Wrongful death claims cover the gross income that the deceased would have provided and their future financial contributions. This includes potential promotions, salary increases, and retirement benefits.

Pain and Suffering

Emotional suffering is a substantial part of the aftermath of wrongful death cases. The pain, grief, and distress the surviving family members experience are immeasurable.

Wrongful death claims recognize this turmoil and seek compensation for the pain and suffering. While no money can ease the pain, these settlements provide some financial relief to those who have had to endure such a tragic loss.

Funeral Expenses

Such expenses are a significant burden for the surviving family members. Amid grieving, cremation or burial expenses can add stress to an already challenging situation. Wrongful death settlements cover costs for the plot, memorial, and other related expenses.

An attorney can help the family understand the full scope of damages they are entitled to. This includes those mentioned above and potentially others, such as loss of companionship and consortium. They can also provide more information on the wrongful death statute of limitations in Ohio.

Exceptional Taxable Amounts in Wrongful Death Settlements

While most wrongful death settlements are generally nontaxable, certain elements may be subject to taxation. A few exceptions include the following:

Punitive Damages

As the name suggests, punitive damages punish the wrongdoer rather than compensate the survivors. The court awards these damages to deter others from committing similar wrongful actions. Families who recover punitive damages must pay taxes according to their jurisdiction.

Accrued Interest

The IRS often considers interest as taxable income. This is important to keep in mind when calculating the tax implications of a settlement.

Emotional Distress Awards

Generally, compensation for emotional distress directly resulting from the wrongful death itself is considered nontaxable.

However, if the emotional distress is not directly tied to the wrongful death or physical injury, it might be subject to taxation. This is a complicated area where the specific circumstances of the case can impact the taxability of the award.

Past Medical Expenses

Medical expenses unrelated to the treatment of the deceased before their passing are taxable. These costs are not a part of the wrongful death settlement but are counted as punitive damages to punish the at-fault party.

Statute of Limitations for Filing a Wrongful Death Lawsuit

Statute of Limitations for Filing a Wrongful Death Lawsuit

Time plays a critical role in personal injury cases. The statute of limitations is a legal time frame within which the plaintiff must file a lawsuit. Failing to meet this deadline can result in the court dismissing the case, and the opportunity for seeking justice vanishes.

In Ohio, the statute of limitations for personal injury lawsuits is two years from the date of the deceased person's death. This might seem like a reasonable amount of time, but amid grief and emotional turmoil, it can pass quickly.

It's crucial for those who have lost a loved one due to negligence or wrongful actions to be aware of this timeframe. Delaying the filing of a personal injury lawsuit can result in the loss of critical evidence, witnesses, and the ability to seek justice.

Final Words

Tax implications can add complexity to challenging personal injury and wrongful act cases. Navigating the path can also be emotionally and financially draining.

At the end of the day, qualified lawyers from a firm like Schuerger Shunnarah Trial Attorneys can help plaintiffs recover damages during their times of sorrow.

With a slogan that says, "We Go to War for You," its professionals can hold the responsible party accountable and provide justice to those suffering from unimaginable losses.


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