# How Is Loss of Income Calculated in New York If You’re Self-Employed? ## Metadata - URL: https://www.douglasandlondon.com/nyc/personal-injury-lawyers/how-is-loss-of-income-calculated-in-new-york-if-youre-self-employed/ - Type: case - Published: 2020-08-05T17:42:35-04:00 - Modified: 2026-06-11T21:29:07-04:00 - Description: Douglas & London personal injury lawyers explain how loss of income is calculated for NY residents who are self-employed. Free consultation. ## Content When accident injuries prevent you from working and earning a living, the consequences can be devastating. It doesn’t take long to get behind on rent payments, car expenses, or a mortgage. Whether you broke your arm in a car crash, or fell and suffered a slipped disc, you deserve to be compensated if another person or party was at fault. It’s standard practice for personal injury claimants to seek damages for loss of income, also known as lost wages or lost earnings. But what if you’re self-employed? By some estimates, nearly 2 million New Yorkers are currently self-employed. How do you calculate loss of income when earnings can fluctuate on a week-to-week basis? Self-employed workers, just like those with stable salaried positions, deserve to be reimbursed for the amount of earnings they would have made had they not been injured. ## **How to prove loss of self-employed earnings** This loss of income isn’t limited to direct payment from clients for services rendered, but also lost business opportunities, loss of future contracts, and the loss of goodwill. The self-employed are entitled to recover all of these damages, but the process of proving your lost earnings is much more complicated. A [New York personal injury lawyer](/) can help injured claimants gather the supporting documentation necessary to prove the loss of self-employment earnings. Bear in mind that the income must be reported and documented in order to seek reparations. If you regularly take cash payments “under the table” for freelance work, it will be impossible to prove this income in a car accident or injury claim. Your attorney will need a strong paper trail to bolster your claim. This will likely include: - **1099 tax statements:** The key to a successful recovery is to demonstrate how much money you would have earned from the date of your injury until the end of your recovery. One of the most convincing documents to support this are 1099 forms, which show earned income from the previous year. - **Business invoices and contracts**: Many self-employed workers have short and long-term contracts with third-parties that stipulate remuneration amounts for services rendered. - **Bank statements:** Your bank statements should demonstrate your regular flow of income (and expenditures), particularly if you have a long history of regular deposits. - **Letter of verification:** If you have been freelancing for a particular client over time, request a letter in which they explain your position, job duties, number of hours, and compensation. - **Medical records:** Proof that you suffered an injury and need time off of work to recover. ## **No-Fault insurance law and lost wage reimbursement** New York is one of 12 states with [no-fault insurance laws](https://www.douglasandlondon.com/blog/car-accidents/what-is-no-fault-insurance-in-new-york/). This means that if you are in an auto accident, the insurance company should cover 80 percent of your lost earnings, regardless of who was responsible for the accident. If you are self-employed, insurance companies will normally ask for the last three years of your tax returns and recent bank statements. No-Fault coverage will cover a maximum of $2,000 a month for lost income until the $50,000 limit is reached. ## **How a personal injury attorney can help** For people with steady self-employment income, calculating your damages is fairly straightforward. If, however, your business or work had been growing substantially prior to the accident, with a marked increase in income, you should consider legal counsel. The right law firm will work with forensic economists who are trained to quantify economic losses for civil litigation. Proving lost income for self-employed workers is invariably more difficult, which is why your choice of legal representation is key. To secure fair compensation, you'll need the guidance of a skilled [personal injury lawyer](/). Douglas & London provides aggressive representation in all types of personal injury matters. We give each client the attention and respect they deserve and have helped hundreds of New York families recover the justice they deserve. Call today to schedule a free, no-obligation case review.