Conscious Pain Suffering
In addition to the economic claim of wrongful death, an accident resulting in death gives rise to a claim for conscious pain and suffering. The rationale is that the decedent’s next of kin essentially steps into the shoes of their loved one and claims the pain and suffering that your loved one could have claimed but for the fact that he/she is now passed away. In a case where a traumatic accident causes an immediate and painless death, this portion of the case is less important. However, in cases where the deceased is conscious in his final moments or hours, the claim for that conscious pain and suffering can constitute a large portion of the overall recovery. There may be tax consequences, however, as opposed to a wrongful death claim, and hence the allocation of the total proceeds between the two is important. Because the conscious pain and suffering portion of the case is a claim that belongs to the decedent and is brought in his name, the portion of the recovery attributed to conscious pain and suffering is part of the decedent’s estate and when it is distributed to his heirs, there may be estate tax implications. The portion of the recovery attributed to wrongful death is an economic claim that belongs to the decedent’s distributees and, for the reasons explained here, does not carry with it any estate or income tax consequences.