Detailed Answer
This article explains how to document and claim lost self-employed income after an accident in South Carolina. It is not legal advice but an educational overview to help you prepare and present your claim.
1. Understand Your Claim Under South Carolina Law
In South Carolina, you can seek compensation for “special damages,” including lost earnings, in a personal injury claim. You must file your lawsuit within three years of the accident under S.C. Code Ann. § 15-3-530. If you miss this deadline, you may lose your right to recover.
2. Gather and Organize Financial Records
Collect documentation that shows your income before and after the accident. Key records include:
- Tax returns (Form 1040 with Schedule C) for the past 2–3 years
- Profit & loss statements or ledgers
- Invoices and receipts issued to clients
- Bank statements showing deposits
- 1099s or other client payment records
Organize these chronologically. Highlight the period affected by your injury to clearly show income shortfalls.
3. Calculate Your Lost Income
Work with a certified public accountant or forensic accountant to:
- Determine your average weekly or monthly income prior to the accident
- Compare that to your actual earnings during recovery
- Adjust for seasonal trends or business growth factors
The difference represents your lost self-employed income. Document all calculations in a detailed report.
4. Prepare a Demand Package
Before filing suit, send a demand letter to the at-fault party’s insurance company. Your package should include:
- A cover letter summarizing your injuries and income loss
- Medical records and doctor statements regarding your recovery time
- Your organized financial records and accountant’s report
- A clear demand figure (total lost income plus any out-of-pocket expenses)
Keep copies of everything you send and note the dates.
5. Negotiate or File a Lawsuit
Insurance companies often respond with a settlement offer. If it’s insufficient, you can negotiate further or file a personal injury lawsuit. In court, these documents become “exhibits” to prove your damages. Ensure you file your complaint within the three-year statute of limitations under § 15-3-530.
Disclaimer
This article is for educational purposes only and does not constitute legal advice. Consult a qualified attorney to discuss your specific situation.
Helpful Hints
- Keep digital and paper backups of all records.
- Maintain an injury journal to track missed workdays and pain levels.
- Request written statements from clients about canceled jobs.
- Consult an accountant early to streamline calculations.
- Act promptly to preserve your right to recover under South Carolina’s three-year deadline.