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Workers’ compensation in Georgia
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Protecting Your Georgia Workers’ Compensation Settlement When Filing Chapter 7 Bankruptcy
by Jodi Brenner Ginsberg
Georgia Workers’ Compensation Attorney
Georgia workers’ compensation law blog
Part One - Your workers’ comp claim is an asset
Your workers compensation claim can have a significant impact on your Georgia bankruptcy filing. Whether your Georgia workers’ comp case arose prior to the bankruptcy filing or if you were injured on the job after you filed a Chapter 7 or a Chapter 13, you, your bankruptcy lawyer and your workers comp lawyer need to understand how these two areas of law overlap so that you can avoid unnecessary complications.
In Georgia, the workers’ compensation law sets out how much you can expect to receive from the insurance company if you are hurt on the job. Georgia workers’ comp law says that you are eligible to received two-thirds of your average weekly wage with a maximum benefit of $400 per week.
As you might imagine, taking a minimum 33% pay cut in your wages can cause financial hardship. As such, injured workers are at risk of falling behind on car payments, house payments and credit card bills.
If you fall behind on secured debts like your mortgage or car loan, Chapter 7 may not help you. Chapter 13 is a better option to stop foreclosures and repossessions.
If you are current with your secured debt, if you don’t have a lot of assets or if you just want to walk away from this type of debt, Chapter 7 can be a good option. Chapter 7 has traditionally been a powerful tool to eliminate credit card debt and other unsecured debts.
Before you file Chapter 7, however, you should put your bankruptcy lawyer in touch with your Georgia workers’ compensation lawyer. Your workers’ compensation case is considered an “asset” for bankruptcy purposes because it potentially has settlement value, and it needs to be listed as such. You need to confirm with your bankruptcy lawyer that your workers’ compensation case is an exempt asset that may be protected from seizure by an overzealous Chapter 7 trustee.
You should also make sure that your bankruptcy lawyer uses the proper figures for your median income/means test calculations. Remember, the median income/means test calculations uses your “average monthly income” that arises from average gross income received over the past six months. In other words, if you were injured in February and you file bankruptcy in March, your average income would be calculated using your pay advices from September through February. Since September through January represent regular pay, your average income may be significantly higher than your new, actual income coming from workers’ comp.
Part Two - Protecting Your Georgia Workers’ Compensation Settlement When Filing Chapter 7 Bankruptcy - click on the link