When a lawyer works on contingency, the attorney’s fee is a percentage of the recovery, usually 33% to 40% of what the case produces. The exact figure depends on how far the case goes before it resolves, what type of claim it is, and whether federal or state law caps the number. If the case recovers nothing, the attorney earns no fee.
That’s the headline. The details below are what actually determine the check you deposit.
Typical Percentages and Sliding Scales
Most personal injury contingency fees land between 33.3% (one-third) and 40% of the total recovery. The number tracks how much work and risk the attorney absorbed. A case that settles after a demand letter, before any lawsuit is filed, tends to sit on the low end. Once a complaint is filed and the case moves into discovery, depositions, and trial preparation, the percentage commonly rises to 40%. Cases taken through a full appeal can push the fee to 45% or even 50%, depending on the jurisdiction and the written agreement.
Many firms build this directly into the contract as a sliding scale: one-third if the case settles pre-suit, 40% once a lawsuit is filed, 45% on appeal. An attorney who spends two years litigating has invested far more labor than one who resolves a claim with a phone call, and the scale reflects that.
These percentages are negotiable. Nothing locks you into the first number the attorney proposes. If liability is clear, damages are well documented, and the potential recovery is large, you have real leverage to ask for a lower rate. On a six-figure settlement, a single percentage point is meaningful money.
Contingency fees aren’t available in every type of case. An attorney cannot charge a contingency fee to defend a criminal case, and the arrangement is prohibited in most domestic relations matters where the fee would depend on obtaining a divorce or on the size of alimony, support, or a property settlement.1American Bar Association. Rule 1.5 Fees Collecting overdue child support or alimony after a judgment has already been entered is generally allowed on contingency.2American Bar Association. Rule 1.5 Fees – Comment
Federal and State Caps That Override Private Agreements
In certain categories of cases, the law sets a ceiling on the percentage an attorney can charge, no matter what the agreement says.
Federal Tort Claims Act
If you are suing the federal government under the Federal Tort Claims Act, attorney fees are capped at 25% of a judgment or litigation settlement and 20% of an administrative settlement reached before suit is filed.3Office of the Law Revision Counsel. 28 USC 2678 – Attorney Fees; Penalty Charging more than the statutory cap exposes the attorney to criminal penalties under the same statute.
Social Security Disability
Attorney fees in Social Security disability cases are capped at 25% of past-due benefits or $9,200, whichever is less.4Office of the Law Revision Counsel. 42 USC 406 – Representation of Claimants The dollar cap is periodically adjusted; the $9,200 figure took effect in late 2024.5Social Security Administration. Fee Agreements If the attorney submits a fee petition instead of a standard agreement, a judge reviews and approves the amount, which may differ from the standard cap.
Medical Malpractice
Roughly a dozen states impose their own limits on contingency fees in medical malpractice cases. Some use a flat ceiling. Others use a declining scale where the percentage shrinks as the recovery grows, often starting somewhere between 25% and 40% on the first tier and dropping on larger recoveries. Check your state’s rule before signing a med mal contingency agreement.
Fees Are Not the Same as Case Costs
The attorney’s fee and the case costs are two separate deductions, and conflating them is one of the most common misunderstandings in contingency cases. The fee is the percentage the attorney earns for legal work. Costs are out-of-pocket expenses the firm advances to push the case forward: court filing fees, medical records charges, expert witness fees, deposition transcripts. Filing fees alone can run from under $100 to over $500 depending on the court. In a complex case, costs can reach tens of thousands of dollars.
Your contingency fee agreement should state clearly who pays those costs if the case loses. Some agreements have the firm absorb costs on a loss; others leave you responsible for repaying them regardless of outcome. Clarify this before signing.
How Your Take-Home Is Actually Calculated
Your net recovery is the total settlement or judgment minus the attorney’s fee and case costs. The order those come out in changes what you keep. The two standard methods are calculating the fee on the gross recovery (before costs) or on the net recovery (after costs).
Walk through a $100,000 settlement with $10,000 in costs and a 33.3% fee:
- Fee on gross: 33.3% of $100,000 is $33,300. Subtract the $10,000 in costs, and you take home $56,700.
- Fee on net: Subtract the $10,000 in costs first, leaving $90,000. 33.3% of $90,000 is $29,970. You take home $60,030.
Same settlement, same percentage, $3,330 difference. The gap widens on larger recoveries and larger cost totals. Your written agreement is required to specify which method applies.1American Bar Association. Rule 1.5 Fees If it doesn’t, ask.
Fees and costs are not the only claims against your money. If Medicare paid for treatment related to your injury, it has a statutory right to be reimbursed from the settlement. Health insurers with subrogation clauses and medical providers with liens can also claim a share. These typically come out after the fee is calculated but before the money reaches you.
Taxes Can Change the Math Dramatically
In 2005, the U.S. Supreme Court held in Commissioner v. Banks that when a legal recovery is taxable income, the plaintiff owes tax on the entire amount, including the portion that goes directly to the attorney.6Justia. Commissioner v. Banks, 543 U.S. 426 (2005) Whether that rule hurts you depends on what kind of case you have.
- Personal physical injury or sickness: Damages are excluded from gross income entirely. On a typical car accident or slip-and-fall settlement compensating you for physical injuries, neither your share nor the attorney’s share is taxed.7Office of the Law Revision Counsel. 26 USC 104 – Compensation for Injuries or Sickness
- Emotional distress without an underlying physical injury: Taxable, except for amounts covering actual medical expenses for the distress. Under Banks, you owe tax on the full settlement including the attorney’s cut.8Internal Revenue Service. Settlements – Taxability (Publication 4345)
- Employment discrimination and certain whistleblower claims: Settlements are generally taxable, but federal law lets you deduct the attorney’s fee as an above-the-line adjustment to income, so you aren’t taxed on the attorney’s share.9Office of the Law Revision Counsel. 26 USC 62 – Adjusted Gross Income Defined
The hazard zone is a taxable settlement that doesn’t qualify for the discrimination or whistleblower deduction. A $500,000 breach-of-contract settlement with a 40% fee leaves you with $300,000 in hand but potentially taxable on the full $500,000. In some situations, plaintiffs have ended up owing more in tax than they personally received. If your case involves anything other than physical injury, talk to a tax professional before you sign off on the settlement.
If You Fire Your Attorney Before the Case Ends
You can discharge your contingency fee attorney at any time. That doesn’t erase the attorney’s financial interest in the case. If the discharged lawyer did work that contributed to the value of your claim, they can usually recover the reasonable value of those services under quantum meruit, often asserted as a lien against your eventual recovery. A court sets the amount, typically closer to an hourly valuation than the full contingency percentage.
Switching lawyers doesn’t mean paying two full fees. The total paid to all attorneys generally cannot exceed what one attorney would have collected under the original agreement, and the pool gets split. But a dispute over how to split it can hold up your payout at the end. If you’re going to switch, do it sooner rather than later; the first attorney’s lien grows with every hour they put in.