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Calculating Lost Income, Earning Potential, and Future Opportunities in a South Dakota Car Accident Case

On Behalf of | Oct 12, 2023 | Car Accidents

If you’re injured in a vehicle accident caused by someone else, South Dakota law allows you to file a claim against the at-fault driver’s insurance company for your damages, which could include medical expenses, property damage, pain and suffering, and income lost due to time off work. Calculating the value of lost income can be challenging, but a personal injury lawyer can help.

Lost Income Damages Include More Than Just Wages

Whether you work full time or part time, as an employee or a contractor, your lost income includes all compensation you would receive from your work had you not been injured in your accident, as well as income lost as a result of undergoing treatment for your injuries (doctor’s appointments, physical therapy sessions, etc.). Some factors that will be considered include the following.

Depending on how you are paid, your damages will be calculated as follows:

Hourly wage

The number of hours you miss from work multiplied by your hourly rate equals the compensation you can claim.

Annual salary

If you’re a salaried employee, you can divide your yearly salary by the number of days/hours you work per year and seek compensation for the total number of days/hours you miss from work.


If you’re the sole proprietor of a business, a freelancer, or an independent contractor, calculating your lost income can be a more complicated process. You’ll need documentation in the form of receipts, invoices, bank records, and 1099 forms.

Even if you’re able to use your allotted sick days or receive vacation pay while off work due to your injuries, those benefits are considered income that you earned by working. All your time off due to injury will be incorporated by your lawyer into your damage claim.

Earning Capacity

If your injuries affect your ability to earn money in the future, you’re entitled to compensation for those future losses. Your attorney can determine the compensation you’ll claim by using a formula based on a variety of factors, including your age, work history, education and job skills, type of employment, and type of injury.

Future Opportunities

If your injuries interfere with your ability to pursue a promotion or to interview for a different job than the one you had, your attorney can incorporate those lost potential opportunities into your demand for compensation. Lost bonuses, profit sharing, and/or pay increases are also compensable.

Proving Your Loss of Income

Simply demanding compensation from the at-fault driver’s insurance company for lost income does not automatically get you a fair settlement. The insurer will be looking for any way it can find to save money by disputing your claim or offering you an unfairly low award.

You’ll need solid evidence to prove that your loss of income resulted directly from your accident, entitling you to fair compensation. Your attorney can obtain, organize, and present a variety of evidence to help you seek justice, including the following:

Medical Records

Acquired from your doctor(s) and/or therapist(s), describing your injuries and explaining how they render you totally or partially unable to work and for what period of time.

Employment Verification

sVerification of your employment/income in the form of a letter from your employer.

Detailed Records of Missed Time from Work

You will need dates and times when you have missed work due to your injuries/treatments.

Other documents needed for your loss of income case includes:

  • W-2 or 1099 forms
  • Income tax returns
  • Pay stubs or direct deposit records
  • Statements and testimony from expert witnesses


Follow These Steps to Help Protecting Your Claim

You can help your attorney prove liability on the part of the negligent driver and establish the connection between your accident and your lost income by taking the following steps at the accident scene to protect your claim:

Do not leave the scene

Stay at the scene and call 911 to report your accident.

When the police arrive

Answer their questions with basic information only.

Allow for the Investigation

Don’t admit any fault to anyone.

Signed Documents

Sign only documents required by police.

Take your own photos

Take photos of the scene and all vehicles involved in the crash. Include pictures of license plates if possible.

Get the other drivers’ information if possible

Exchange information with the other driver(s), but do not discuss the crash. Stay calm.

Get contact information from any witnesses to the crash.

Possible Video Footage

Note the location of nearby video cameras that might have footage of the wreck.

Contact your insurance company

Seek medical attention immediately after the crash to document your injuries.

Consult a car accident lawyer.

Have You Lost Income Due to Injuries Suffered in a South Dakota Vehicle Accident?

An experienced car accident lawyer can calculate all your damages, including lost income, lost future earning capacity, and lost opportunities, and fight to get you compensation while you focus on your recovery. Contact us online or call us at 605-644-5003 to schedule a free consultation. You pay no attorney fees until we win your case.