How a Personal Injury Settlement Can Affect Child Support Payments

A personal injury settlement can have significant impacts on a person’s financial situation. Because much of a settlement award can be considered as income, there are many unexpected components that are also bound to be affected when someone receives a large award. Child support might be one of these.

If you receive a personal injury settlement while paying child support, the amount of money you are required to pay in child support each month might change. This likely depends on the amount of the settlement and several other factors. The following are some ways in which your child support payments can potentially change.

  1. Taxable or Nontaxable Income:

Majority of states consider personal injury settlement awards as a form of income. This means that the settlement award is able to be taxed and can be considered when determining child support payments. Because income is a factor in determining how much a parent will pay in child support payments, a large settlement may increase the amount you must pay.

Whether the award is considered as income or might depend on its amount. For example, an award may have to be greater than a certain amount to be considered as income.

  1. Applicable Worth:

If you receive a large personal injury settlement that outweighs the costs of damages, then it is possible that the courts may raise your monthly child support payments. If, however, the settlement is only enough to cover medical bills and living expenses, then they may excuse it.

  1. Missed Payments:

If your personal injury disabled you for a period of time or hurt your financial situation, then you may have fallen behind on some child support payments. Regardless of the reason, you are legally required to make child support payments on time, and pay back what you have not already paid. The courts may suggest or require that the missed child support payments are paid for with a portion of the settlement.

  1. Loss of Wages:

If you are unable to work, then a personal injury settlement will usually cover lost wages and income. Although you may have been unable to pay child support because of missing work due to an injury, compensation for lost wages are required to be counted toward child support payments.

If you have received a personal injury settlement, you should speak with a child custody lawyer Flower Mound, TX residents rely on. They can help you determine whether your child support payments will be affected, as well as what portion of your settlement may be used toward child support.

Thank you to our friends and contributors at Scroggins Law Group for their knowledge about child support and custody.

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