What percentage of a settlement does a lawyer take?

Personal injury lawyers usually charge a contingency fee, commonly around one third of the recovery, and sometimes more if the case goes to trial. Under the ABA Model Rules, a contingency fee agreement must be in writing and must state the percentage and whether expenses are deducted before or after the fee is calculated.

Do I have to pay back my health insurance or Medicare from a settlement?

Often, yes. Health insurers may have a lien or subrogation right, and Medicare's conditional payments must be repaid from a liability settlement under the Medicare Secondary Payer rules. These repayments can sometimes be negotiated down.

Is a car accident settlement taxable?

Under federal tax law, compensation received for personal physical injuries is generally excluded from income (26 U.S.C. 104(a)(2)). Punitive damages and interest are generally taxable, and medical expenses you previously deducted may be taxable when reimbursed. Ask a tax professional about your situation.

How Much of a Car Accident Settlement Do You Actually Get?

The settlement amount is not what you receive. In a typical represented case, the attorney fee, case costs and repayment of medical liens come out first. In the example below, a $30,000 settlement leaves the injured person with about$12,500–$13,000 (42%–43%), depending on how the fee agreement handles costs.

Last reviewed: 2026-11-13

What comes out of a settlement, in order

Attorney fee. Usually a contingency percentage, commonly about one third.
Case costs. Filing fees, medical records, expert reports. Your agreement says whether these are deducted before or after the fee is calculated.
Medical liens and reimbursements. Health insurers, hospitals, Medicaid and Medicare may need to be repaid.
Your share. What is left is paid to you.

Worked example: $30,000 settlement

	Fee on gross, then costs	Costs first, then fee
Settlement	$30,000	$30,000
Attorney fee (1/3)	−$10,000	−$9,500
Case costs	−$1,500	−$1,500
Medical liens	−$6,000	−$6,000
You receive	$12,500 (42%)	$13,000 (43%)

Deducting costs before the fee is calculated is better for you. Check this clause in any fee agreement before you sign. To run your own numbers, use the settlement calculator, which shows the take-home amount for your state.

Medicare and health insurance repayment

If Medicare paid any accident-related bills, those are "conditional payments" that must be repaid once you receive a liability settlement. Medicare's recovery contractor issues a final demand after settlement, and the amount is reduced pro rata for procurement costs such as attorney fees. Private health plans and Medicaid can have similar rights depending on the plan and state.

Taxes

Settlement money for personal physical injuries is generally not taxable income under federal law. Punitive damages and interest generally are. State tax treatment can differ.

Frequently asked questions

What percentage of a settlement does a lawyer take?: Personal injury lawyers usually charge a contingency fee, commonly around one third of the recovery, and sometimes more if the case goes to trial. Under the ABA Model Rules, a contingency fee agreement must be in writing and must state the percentage and whether expenses are deducted before or after the fee is calculated.
Do I have to pay back my health insurance or Medicare from a settlement?: Often, yes. Health insurers may have a lien or subrogation right, and Medicare's conditional payments must be repaid from a liability settlement under the Medicare Secondary Payer rules. These repayments can sometimes be negotiated down.
Is a car accident settlement taxable?: Under federal tax law, compensation received for personal physical injuries is generally excluded from income (26 U.S.C. 104(a)(2)). Punitive damages and interest are generally taxable, and medical expenses you previously deducted may be taxable when reimbursed. Ask a tax professional about your situation.