Detailed Answer
Experiencing a drop in self-employed income after an accident can lead to significant financial strain. Under Wisconsin law, you can recover lost profits as economic damages. Documenting these losses accurately ensures full compensation. Below is a step-by-step guide.
1. Understand Lost Income Claims in Wisconsin
Lost self-employed income qualifies as economic damages in a personal injury claim. You must show that the accident directly caused a reduction in your net business profits.
2. Know the Statute of Limitations
In Wisconsin, you must file a lawsuit within three years of the accident under Wis. Stat. § 893.54(2). Missing this deadline typically bars your claim.
3. Gather Comprehensive Documentation
As a self-employed individual, collect all records that establish your income before and after the accident:
- Tax returns (Schedule C) for the year before and after the accident
- Profit and loss statements
- Bank and accounting records showing business deposits and expenses
- Invoices, contracts, and client communications
- 1099 forms, receipts, and payroll records
4. Calculate Net Lost Profits
Court and insurance adjusters focus on net profit, not gross revenue. Subtract ordinary business expenses from gross receipts to show actual losses. Use consistent accounting methods to enhance credibility.
5. Use Expert Analysis
Consider hiring a forensic accountant or vocational economist. They can prepare a detailed damage report, forecast future income losses, and testify at trial or during settlement negotiations.
6. Initiate Your Claim
Begin with a written demand to the at-fault party’s insurer. Attach your documentation and a clear calculation of damages. If settlement talks stall, you may file a lawsuit and use discovery tools—such as interrogatories under Wis. Stat. § 804.08—to obtain additional evidence.
7. Address Common Challenges
Insurers may question business fluctuations. Counter these challenges by:
- Showing consistent revenue patterns before the accident
- Demonstrating efforts to mitigate losses (e.g., seeking temporary work)
- Explaining seasonal or industry-related income variations
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult a qualified attorney in Wisconsin to discuss your specific situation.
Helpful Hints
- Keep digital and paper copies of all financial records.
- Track income weekly or monthly to show precise loss periods.
- Update your documentation as you receive new records.
- Be transparent about normal business ups and downs.
- Discuss your case early with an attorney experienced in Wisconsin personal injury law.