How are wrongful death settlements divided in Colorado?

Denver, CO – When someone is killed in a tragic accident caused by someone else’s negligence, shared grief will bring a family together, but when one of them brings up a possible wrongful death lawsuit, they may not all be on the same page. A lot of questions come up – who has the legal right to initiate this type of claim and how will the money be divided among heirs? If you’re struggling with these problems it is imperative that you talk to an experienced wrongful death attorney in Denver and the sooner the better. If the heirs don’t see eye to eye, it may be necessary that they each get an attorney to make sure their rights are protected. 

Who can initiate a wrongful death lawsuit in Denver?

Under Colorado laws, the statute of limitations for a wrongful death lawsuit is 2 years. In the first year, it is the surviving spouse who can file a lawsuit. During the second year, the children of the deceased can initiate their own lawsuit. If there are no children or a surviving spouse, then the parents can come forth and file a wrongful death lawsuit. Unlike other states, in Colorado, the siblings of the deceased are not allowed to seek compensation.

How are damages divided in Colorado?

Once a settlement is reached or a lawsuit is won, the heirs will have to split the damages. This is done in accordance with Colorado’s laws of succession and estate distribution laws. For instance, if it was the surviving spouse that filed the lawsuit any money they win will be divided with the deceased’s children. The same applies if it is the children who seek damages – they will share the money with the surviving spouse. 

To understand how the state’s succession laws work, it’s best to seek legal advice, as it can be quite a complicated issue. Each family is unique, the spouses may have had children together or the deceased may have had children from another relationship and different rules apply.

Generally speaking, the surviving spouse will receive a lump sum, plus 50% of the rest of the settlement. The children will each get an equal share of the remaining money. The lump-sum the surviving spouse receives may differ, depending on the age of the children, if they are minors or adults.

Are wrongful death settlements taxable in Colorado?

According to the IRS, wrongful death settlements are not taxable. That is because a financial settlement of this type is compensation for a loss already sustained. It is not a form of new income, so taxation rules do not apply. 

However, things are never that easy when it comes to the IRS. For instance, parts of the settlement may be considered taxable if you deducted some of the medical expenses. 

Also, if you won a lawsuit and punitive damages were awarded, that part of the final settlement is taxable. 

If you recently lost someone in a tragic accident and are considering a lawsuit, talk to a knowledgeable wrongful death lawyer at the Bryan & Terrill law firm which offers help to bereaved families in the Denver area.

Contact info:

Bryan & Terrill 

333 W. Hampden Ave., #420B 

Englewood, CO 80110

(720) 923-2333

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