Charlotte is the most populous city in North Carolina. Home to over 874,579 people and known as “Charlotte USA – The New Energy Capital.” There are an increasing amount of employees working in Queen City every day.
Every business owner in Charlotte wants to make sure they take the necessary steps to protect their employees. One of the key components of employee protection is workers’ compensation insurance. This type of insurance provides benefits to employees who are injured or become ill due to their job. But do you have to pay taxes on your workers’ compensation settlement in Charlotte? Our experienced workers’ compensation attorneys encourage you to read on for the answer.
North Carolina’s Workers’ Compensation Act
The North Carolina Workers’ Compensation Act is the state law that governs workers’ compensation in Charlotte. The law requires most employers to carry workers’ compensation insurance and provides benefits to employees who are injured or become ill as a result of their job.
Under the law, workers’ compensation benefits are paid to employees who are injured or become ill as a result of their job. Benefits can include lost wages, medical expenses, and death benefits.
In addition, the law provides for a system of workers’ compensation insurance that is designed to protect employers from liability for injuries or illnesses that occur in the course of employment.
There are a few exceptions to the workers’ compensation law in North Carolina. For example, federal employees and some railroad employees are not covered under state law. In addition, certain types of businesses may be exempt from the requirement to carry workers’ compensation insurance.
Is Workers’ Compensation Taxable in Charlotte, NC?
In general, workers’ compensation benefits are not taxable. This includes the income replacement benefits and the medical expenses covered by workers’ compensation. However, there are a few exceptions to this rule.
When Are Workers’ Comp Benefits Taxable in Charlotte, NC?
There are only a few instances where workers’ compensation benefits may be taxable.
Light Duty Work
When an injured worker returns to work for light or modified duty, any wages they receive are taxable. There are exceptions to this, such as if they are also receiving Temporary Partial Disability Benefits. Contact a workers ‘ compensation attorney today to learn more about what that means for you.
Social Security Benefits
If you’re receiving Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI), this is considered supplemental and can be taxed. In this case, payments from SSDI or SSI are reduced, and the difference created by the amount of workers’ compensation would be taxable.
North Carolina Workers’ Compensation Income Limits
There is also an income limit for workers’ compensation benefits in North Carolina. If your weekly benefit amount exceeds two-thirds of your average weekly wage, the excess amount is considered taxable income.
For example, if you earn an average of $600 per week, two-thirds of that amount would be $400. Therefore, any benefits you receive that are more than $400 per week would be considered taxable income.
Types of Charlotte Workers’ Compensation Benefits
The two most common workers’ compensation benefits are income replacement benefits and medical expenses.
Income replacement benefits, also known as wage replacement benefits, are paid to employees who cannot work due to their injury or illness. These benefits can be paid in weekly payments or lump sum payments.
Some income replacement benefits include:
- Temporary Total Disability Benefits (TTD) – TTD benefits provide income replacement for a set period of time while recovering from your injuries.
- Temporary Partial Disability Benefits (TPD) – TPD benefits provide income replacement for a set period of time while recovering from your injuries.
- Permanent Partial Disability Benefits (PPD) – PPD benefits provide income replacement for long-lasting limitations. (Loss of vision, hearing, or certain body parts.)
- Permanent Total Disability Benefits (PTD) – PTD benefits provide income replacement for the rest of your life.
- Workers’ Compensation Death Benefits – If an employee dies due to their work-related injury or illness, their surviving spouse and dependent children may be eligible for death benefits. These benefits can be paid in a lump sum or as weekly payments.
Medical expenses are covered under workers’ compensation insurance. This includes the cost of doctor’s visits, hospital stays, and any other necessary medical treatment. Workers’ compensation will also cover the cost of prescription drugs and rehabilitation.
Filing a Workers’ Compensation Claim in Charlotte, North Carolina
In North Carolina, injured workers must file their workers’ comp claim with the North Carolina Industrial Commission within two years of their injury or illness. Workers’ compensation claims can be filed online, by mail, or in person.
How Long Do Workers’ Compensation Benefits Last in Charlotte, North Carolina?
In most cases, injured Charlottean workers can receive benefits until they reach maximum medical improvement. Maximum medical improvement (MMI) is when your condition has stabilized and is not expected to improve further.
Contact an Experienced Charlotte Workers’ Comp Lawyer Today
If you are an injured employee, you deserve to get the full benefits that you are entitled to under the North Carolina workers’ compensation law. If you have been injured at work, don’t hesitate to contact an experienced attorney. At The Law Offices of Jason E. Taylor, we work with you on your workers’ compensation case to ensure you get the compensation you deserve to focus on your recovery and get back to work as soon as possible.