*Sponsored by the Civil Litigation and Taxation Law Section Councils
There is far more to litigation than winning the case. Your client may be
ecstatic with the result you obtained — until the IRS comes calling. Or, you may
represent the defendant, who can significantly reduce his costs if the payment
can be structured as deductible. Having an idea of the tax results for both your
client and the defendant will make you far more effective in negotiating
settlements, because you will better understand what the payments mean to each
side.
Taxation is not the only issue. If your client is elderly or disabled,
personal injury settlements and judgments may require satisfaction of Medicare’s
lien interest. If Medicare’s lien interest is not protected, the Medicare
recipient, plaintiff’s counsel and the defendant/insurer issuing payment may all
be liable to satisfy the Medicare lien. Knowing how properly to handle Medicare
liens, will be critical to an effective representation of elderly and disabled
clients. Topics include:
- Taxation of damages for personal injuries;
- What does and does not constitute personal injury within the meaning of
the Internal Revenue Code;
- Taxation of damages in several non-personal injury contexts;
- Taxation of punitive damages in both the personal injury and non-personal
injury contexts;
- Possible ways to structure settlement agreements to trigger beneficial tax
provisions;
- How to confirm the existence of a Medicare lien and the timeline that will
follow; and
- How to negotiate and satisfy a Medicare lien, and the penalties for
failing to do so.
If the attorney does not know the tax results of a potential settlement, he
may not provide the client with effective representation, since he is hampered
in his ability to negotiate the best deal for the client. In addition, the
client may be more likely to sue the lawyer if he settles without being advised
of the economic results of the settlement as the result of likely tax exposure.
Last, Medicare may sue the Medicare recipient, plaintiff’s counsel and the
defendant/insurer issuing payment of the settlement or judgment if Medicare’s
lien interest is not properly preserved.
If you are a personal injury attorney or litigator whose cases involve civil
damages, don’t miss this program.
Faculty:Joan B. Di Cola, Esq., program chair
Law Office of Joan B. Di Cola, Boston
Michael B. Bogdanow, Esq.
Meehan, Boyle, Black & Bogdanow, Boston
Michael H. Hayden, Esq.
Morrison Mahoney LLP, Boston
Sponsoring Sections: Civil Litigation Section
Taxation Section
The Sole Practitioner and Small Firm Section
Related Practice Areas: General Civil Law, Tax Law