WHAT IS A STRUCTURED SETTLEMENT?
A structured settlement is a voluntary agreement reached between a plaintiff and a defendant under which the plaintiff/claimant receives compensation for an injury or wrongdoing. Structured settlement annuities allow claimants to receive a stream of guaranteed payments designed to meet their specific needs.
TWO TYPES OF STRUCTURED SETTLEMENTS
Tax-Free Structured Settlement (Physical Injury)
Physical injury settlements can be designed in such a way to place a portion of the proceeds of the structured settlement into an annuity to provide 100% tax-free payments. Annuities are placed with the most highly rated life insurance companies available and provide unparalleled security for your clients.
Taxable Structured Settlement (Non-Physical Injury)
The taxable structured settlement annuity applies many of the same features of a tax-free structured settlement annuity to a wide range of cases providing guaranteed and reliable payments with a competitive rate of return on a tax-deferred basis to the claimant.
BENEFITS OF TAX-FREE AND TAXABLE STRUCTURED SETTLEMENTS
1. Tax-Free Income for Physical Injury Cases
The full amount of the damage payment(s) is tax-free, exempt from federal and state income taxes under 104(a) of the IRS codes. 2. Safe and Reliable
The claimant receives payments from one of the safest investments available: A highly-rated life insurance company annuity. 3. Tax-Deferred Income for Non-Physical Injury Cases
The claimant receives the benefit of tax-deferral on their payments along with competitive rates of return. 4. Customized Payment Options
The claimant receives periodic payments when needed as determined at the time of the settlement.
HOW THE SETTLEMENT PROCESS WORKS
TAXABLE STRUCTURED SETTLEMENTS ARE USED IN THE FOLLOWING CASES:
- Structured Installment Sales
- Employment Issues
- Age, Gender, or Race Discrimination
- Attorney Fee Deferrals
- Divorce Settlements
- Environmental Litigation
- Sexual Harassment
- Legal Malpractice
- Property Disputes
- Breach of Contract
- Fraud Claims