What is a Structured Settlement?
Structured settlements are a method of compensating
injury victims. A structured settlement is a voluntary
agreement reached between two parties, typically a plaintiff
and a defendant, under which the injured person is
compensated for damages in the form of a stream of periodic
cash payments purchased for the plaintiff on behalf of the
defendant. Structured Settlements are a completely voluntary
agreement between the injury victim and the defendant.
How are Structured Settlements paid?
Under a structured settlement agreement, an injury victim
doesn't receive compensation for their injury in one lump
sum. The victim receives a stream of tax-free payments
tailored to meet future medical expenses and basic living
needs.
Why use a Structured Settlement?
Often two parties can not agree on all the terms in a law
suit, so a structured settlement arrangement allows one
party to get their price, while the other gets their terms.
Who sets up a Structured Settlement?
A structured settlement may be agreed to privately, in
mediation, in a pre-trial settlement or it may be required
by a court order. Often an attorney draws up the necessary
structured settlement paperwork.
How can I cash my Structured Settlement for a lump sum
payment?
You can find brokers or companies to purchase and buy
Structured Settlements.
Are there tax advantages to a Structured Settlement?
Structured settlements may also offer a tax advantage that
becomes part of the benefit in using a fixed annuity as part
of a structured settlement. The fixed annuity payments are
income tax-free to the claimant and the liability can be
removed from the defendant's books, in many cases.
What is a Structured Settlement?