GLOUCESTER POINT, VA - After a personal injury settlement in Virginia, several deductions may reduce the final amount an accident victim receives, including attorney fees, medical liens, case expenses, and potential subrogation claims. Gloucester County personal injury attorney Ken Gibson of GibsonSingleton Virginia Injury Attorneys (https://www.gibsonsingleton.com/blog/what-comes-out-of-my-compensation-after-a-personal-injury-settlement/) details the common deductions that affect settlement payouts and how Virginia law protects injured plaintiffs from excessive lien claims.
According to Gloucester County personal injury attorney Ken Gibson, most personal injury attorneys work on a contingency fee basis, collecting a predetermined percentage of the settlement, typically ranging from 33 to 40 percent, only if the case is successful. Case expenses, which are separate from attorney fees, may include discovery costs, court filing fees, expert witness fees, investigation expenses, and document retrieval charges. "Understanding these deductions before settlement negotiations helps individuals plan financially and avoid surprises when the settlement check arrives," explains Gibson.
Gloucester County personal injury attorney Ken Gibson notes that Virginia Code § 8.01-66.2 gives certain healthcare providers a statutory lien against personal injury claims. However, Virginia law caps these liens to protect injured plaintiffs. Hospitals and nursing homes may claim up to $2,500, physicians, nurses, physical therapists, and pharmacies may each claim up to $750, and emergency medical services providers may claim up to $200 per ambulance ride. State-operated facilities under § 8.01-66.9 are not subject to these caps.
Attorney Gibson emphasizes that Virginia's anti-subrogation statute, Virginia Code § 38.2-3405, provides significant protection for accident victims by prohibiting most private health insurance companies from seeking reimbursement from personal injury settlements. "This is a major advantage for Virginia accident victims compared to many other states where health insurers routinely claim large portions of settlements," he adds. However, self-funded ERISA plans, Medicare, Medicaid, Tricare, and other federally backed health programs are exempt from this protection.
The firm reviews all medical liens to ensure they are valid, properly capped, and related to accident injuries. Some providers attempt to claim amounts above statutory caps or seek reimbursement for treatment unrelated to the accident. Gibson notes that even valid liens can often be negotiated downward, as lien holders face uncertainty about case outcomes and may accept reduced amounts rather than risk receiving nothing if a case fails.
"Early coordination with lien holders typically yields better results than last-minute negotiations," advises Gibson. "Identifying all potential liens at the beginning of a case and maintaining communication throughout prevents delays when settlement funds arrive." The firm also works with treating physicians to document which treatment stems directly from accident injuries, preventing inappropriate claims for unrelated care.
Regarding tax implications, compensation for physical injuries and medical expenses is generally not taxable under federal or Virginia law. However, lost wages, punitive damages, and interest earned on settlements may be subject to income taxes. The IRS treats lost wage compensation the same as regular wages, subjecting it to federal income tax. Individuals with complex settlements involving multiple damage categories may benefit from consulting a tax professional to minimize tax liability.
Gibson and co-counsel John Singleton have represented accident victims throughout Gloucester County and the Middle Peninsula for over a decade. Both former U.S. Marines, they bring a commitment to thorough case preparation and aggressive negotiation on behalf of injured clients. The firm handles every aspect of the claims process, from initial paperwork through lien negotiation and final settlement distribution.
For those dealing with settlement deductions after a personal injury in Virginia, consulting an experienced attorney may help maximize the final recovery by challenging improper liens and negotiating reductions.
About GibsonSingleton Virginia Injury Attorneys:
GibsonSingleton Virginia Injury Attorneys is a Gloucester Point-based personal injury law firm dedicated to representing accident victims throughout Gloucester County and the Middle Peninsula. Led by attorneys Ken Gibson and John Singleton, both former U.S. Marines, the firm handles car accidents, motorcycle crashes, and other personal injury cases. The office is located at 4073 George Washington Memorial Highway in Hayes, Virginia. For consultations, call (804) 413-6777.
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Company Name: GibsonSingleton Virginia Injury Attorneys
Contact Person: Michelle Cain
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Phone: (804) 413-6777
Address:4073 George Washington Memorial Hwy
City: Hayes
State: Virginia 23072
Country: United States
Website: https://www.gibsonsingleton.com/
