Structured Settlements Are Tax
settlements provide a steady stream of cash that is completely
free of tax liability, both Federally and at the State level.
This is completely different than lump sum settlements where
investment proceeds made with them such as interest are subject to
both Federal and State taxes.
Structured Settlements Are More
benefit to structured settlements, especially for seniors and
their adult children, is that there is added security in receiving
smaller amounts of cash over time.
Many seniors are the target of greedy people and a large pot
of available cash can make them an even more attractive target to
conmen, and subject them to permanent loss of assets if they are
grossly mismanaged by a trustee.
structured settlement means that there is a smaller pot of
cash, which is not nearly as attractive to the conman.
Even in the event that there is a financial loss, a
structured settlement means that the loss is not as large, and there
will be additional income coming in the months and years ahead.
Structured Settlements Are Worry
third benefit to structured settlements is that the recipient
doesnít have to worry about investment strategies or not
adequately planning for the future. Those who do not receive structured settlements must
concern themselves with making sure that they do not overspend from
an account that looks like it should last forever, and subject the
entire award to financial risk.
million dollar lump sum payment looks huge, and a few thousand here
and ten thousand there donít seem to make much of a dent when you
look at them individually.
However, investment proceeds from lump sum settlements are not
tax-free and attorneys must be paid out of whatever payments have
been received. So if
this million-dollar settlement is supposed to last for 25 years and
a few unwise purchases are also made, it is not impossible to see
this million-dollar lump sum settlement effectively turn into 20
thousand dollars per year.
of course, is hardly a living income much less will pay for any
medical expenses. Consequently,
many people who opt for the lump sum payment will find themselves on
public assistance in relatively short time.
Structured Settlements Are Cheaper
fourth benefit to structured settlements is that they are
often arrived at without the risk and time loss of going to court.
For many reasons, defendants who believe they could have
liability will make an offer of a structured settlement to
minimize their costs.
people relish the idea of going to court including defendants
because while there is the potential for coming out ahead, there is
also the potential for coming out much farther behind than a
negotiated structured settlement would give them.
In most cases, settling a case with structured settlements
can minimize the risk to both sides.
most cases where the structured settlement is made out of
court, attorney fees will be much cheaper than if litigation is
required. If your attorney does not need to go to court, you
can see their fees be reduced by as much as 8% of the total
settlement. On a one million dollar settlement, that means
about $80,000 more for you.
on Structured Settlements