Lost Wages Claims — Smart Financial Analysis

Lost Wages Claims Overview

Lost wages claims recover income you couldn't earn due to injury, illness, or wrongful action. The average personal injury lost wage claim is $20K-$50K. Workers' compensation pays 2/3 of your average weekly wage (tax-free). Lost earning capacity — for permanent disability — can be worth millions over a lifetime. Documentation is key: pay stubs, tax returns, employer letters, and doctor's notes proving inability to work. Self-employed individuals use tax returns and business records. This calculator estimates your total lost wages claim.

Sources: OSHA, Workers Compensation Board, NOLO Legal, BLS

How to Calculate Lost Wages

Lost wages = (Annual salary + overtime + benefits + bonuses) ÷ 12 × months unable to work. Include all income sources for a complete claim.

Lost Wages vs Lost Earning Capacity

Lost wages cover a specific recovery period. Lost earning capacity applies to permanent disability—your reduced ability to earn over your remaining work life.

Courts often use vocational experts and economists to project lifetime lost earning capacity. A 30-year-old with 30% disability and 35 years of work remaining could have a claim worth $1M+.

Workers Compensation Lost Wages

WC pays 2/3 of your average weekly wage, tax-free, during temporary disability. Permanent disability benefits depend on your state's injury rating schedule.

Most states cap weekly benefits (e.g., $1,500/week max). Benefits are not taxable. You must report within your state's deadline—typically 30 days of injury.

Documentation Requirements

Gather pay stubs, W-2s, tax returns (2-3 years), employer verification letter, and doctor's notes. Self-employed? Use business records and profit/loss statements.

• Pay stubs from 6-12 months before injury
• Employer letter on company letterhead
• Doctor's notes proving inability to work
• Tax returns for self-employed and bonus verification

Wrongful Termination Claims

You can claim lost wages until reemployment plus wage differential if your new job pays less than your previous position.

Mitigation: You must make reasonable efforts to find new work. Courts may reduce recovery if you failed to mitigate. Document all job applications.

Medical Malpractice & Lost Earning Capacity

Permanent disability reduces earning capacity. A 30% disability on a $120K salary = $36K/year in lost earning capacity, potentially millions over a lifetime.

Vocational experts assess your residual capacity. Present value calculations reduce future losses to today's dollars (typically 3-5% discount rate).

Self-Employed Lost Income

Use tax returns and business records to prove lost revenue. Average the prior 2-3 years of income for a defensible claim.

Defense attorneys often challenge self-employed claims. Strong documentation—invoices, bank statements, client contracts—strengthens your case.

Claim Types at a Glance