How Is Wage Loss Calculated If You’re Self-Employed?

If you suffer an injury at work and are forced to miss some time away while you recover, you can collect wage loss benefits to help offset the loss in income. Wage loss benefits are payable through a workers’ compensation claim, and the amount of your wage loss is based on your earnings. This tends to be pretty easy to calculate if you are salaried or have a rather steady paycheck, but what if you don’t earn a standard paycheck because you’re self-employed? We take a look at how wage loss benefits are calculated in Minnesota if you are self-employed.

Self-Employed Wage Loss Benefits

Figuring out an amount to claim when pursuing wage loss benefits is a little trickier if you’re self-employed, but it’s certainly not impossible. However, we do absolutely recommend consulting with an attorney to help ensure that you are maximizing your claim amount. If you rely on poor or incorrect calculations, you could be leaving thousands of dollars on the table, shortchanging yourself and your family.

If you’re self-employed, there’s a good chance that you don’t end up getting a paycheck every Friday. Even if you do pay yourself at regular intervals, these amounts may vary greatly based on how much you worked or the success of your business ventures. So how can you figure out how much to pursue in wage loss benefits?

Oftentimes a Minnesota workers’ compensation attorney will recommend that you try to figure out the average amount of money you earn on a weekly basis. One way to do this is to look at your earnings from the last six months (or 26 weeks). Take your total earnings over that period and divide it by 26 to figure out an average weekly pay. You can expect to receive two-thirds of this amount assuming your insurance provider signs off on your wage loss claim.

If 26 weeks of compensation doesn’t provide the most accurate picture, another common way that a self-employed individual can calculate their average weekly earnings is by reviewing their tax records for the previous two years. Take your reported income over those two years, add the amounts together, and then divide by 104 (the total amount of weeks in two years). This will give you a fairly accurate estimate as to how much you earn each week, even if you don’t get paid at regular intervals.

Don’t be surprised if you run into some pushback from the insurance company when attempting to file for wage loss benefits as a self-employed individual. To help combat this and to ensure you have a professional in your corner to assist with the process, connect with an experienced personal injury lawyer like Dean Margolis and the team at Margolis Law Firm. Not only can we help you win your case, but we can do all the calculations and file the necessary paperwork so that you can have peace of mind knowing everything is in order. Let us do the heavy lifting while you focus on your injuries, your business and your family.

For more information, or for help with a different workers’ compensation issue, reach out to Dean Margolis today at (952) 230-2700.