Equalization: Personal Injury Awards, Part 2

Equalization: Personal Injury Awards, Part 2

In a previous post, we discussed whether you can exclude your personal injury award from your net family property. In general, you can exclude the award if it meets certain criteria. This post explores how the timing and the structure of the award may impact whether it is shared with your ex-spouse.  The timing and structure of a settlement can determine whether the funds are treated as property or income, and whether they are shared with your spouse.

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Equalization: Personal Injury Awards, Part 1

Equalization: Personal Injury Awards, Part 1

As discussed in a previous post, upon separation spouses calculate their net family properties, and an equalization payment is usually paid by the spouse with the higher NFP to the spouse with the lower NFP. The goal of this equalization payment is to equalize each spouse's NFP. When calculating your NFP, the Family Law Act sets out a number of different categories of property that are not to be included in the calculation. One category of excluded property is damages, or a right to damages arising from a personal injury. 

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