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Liens and Workers’ Compensation

Liens are not usually the first thing that comes to mind when people think about calling a workers’ compensation lawyer or filing a workers’ compensation lawsuit. Liens can have a huge impact on your workers’ compensation benefits or settlement however. If you owe the government, companies, or another person money, you may have heard of a lien.

What is a Lien?

A lien is another person or organization’s right over your property, used as security for a debt. It means they have a right to own your property if you do not pay the debt. Liens are placed over specific property, such as houses, cars, or money that you have. If you own a home and have a mortgage on it, you likely have a lien on your home. Similarly, if you bought a car and owe money on the car, there is likely a lien on your car.

Types of Liens That Can Affect Your Case

Tax liens and workers’ compensation- the government can create a lien on your property if you fail to pay taxes.

Child support liens and workers’ compensation- the government can create a lien when someone fails to pay child support.

Medical liens and workers’ compensation- if you had medical procedures or treatments and did not pay for them, the medical provider may take a lien to have it paid back.

Settlement liens and workers’ compensation- a lien against your settlement in a workers’ compensation or personal injury case. Any of the above liens can become settlement liens if the money in the settlement is used to pay off the debt.

Workers’ compensation liens- this may be a bit confusing because these are liens taken to pay back what you were paid through workers’ compensation. A workers’ compensation lien can be placed on a third-party lawsuit such as a personal injury lawsuit against another party that was partly responsible for your injury. This type of lien is different from the other types discussed because the rest are liens that can potentially be satisfied using your workers’ compensation settlement, while a workers’ compensation lien is a lien used to pay back workers’ compensation from another settlement.

What is a Levy?

A levy is when a court actually takes action to seize your money or property. Levies are a court order to take the money from your accounts or to transfer title to your property, such as your car or house.

How is a Levy Different From a Lien?

A lien is simply someone’s right over your property. It is usually your responsibility to pay off the lien. This can be paid out from your bank accounts, by transferring title to the property, or can be paid directly from a workers’ compensation settlement. A levy is usually used when the person fails to pay the lien.

A court will order a levy on your bank accounts or other property. The bank that has your money will pay out the money to the person that you owe money to, and will often make you pay a fee for doing so. You may even be liable to pay court costs and other fees if a levy had to be used to paid the money out. For other property, the court may order that title to your car or house be transferred. You may then be faced with repossession of your car, or being evicted from your house.

How Does a Lien Effect Your Settlement?

A lien against your settlement is going to be taken directly from the settlement amount and will be paid to the creditor before you get your portion of the settlement.

Tax liens are different however. Workers’ compensation payments and settlements are excluded from tax liens. If you receive workers’ compensation payments or a settlement, the government cannot take that money to pay off your tax lien.

Wages however can be garnished to repay what you owe. Because of this, if part of your workers’ compensation settlement includes payment for unpaid work, that part of the settlement can be automatically taken by the government to pay back what you owe in taxes. Child support liens and medical liens similarly can be taken directly out of your workers’ compensation settlements.

What Should You do If You Owe any of These Debts and Have a Workers’ Compensation Claim?

It is essential that you speak to experienced workers’ compensation attorneys who can help you get the maximum amount you can for your injury. If you try to settle the claim yourself, or turn to an inexperienced workers’ compensation attorney, you might lose your claim altogether, or settle for such a low amount that you may not even be able to pay off the debts you owe.

If you have been injured at work and are worried that you may have liens against you, you should call us right away so that we can discuss your options with you. Call us today at 1-800-518-4529 to find out how we can help you get the most out of your case.

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