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What are Structutred Settlements and Where Can I sell Them?
A Structured settlement is best to be sold in a lump sum to Einstein to achieve the maximum amount possible for a settlement from any type of lawsuit or investment that you may have purchased.
A Structured Settlement is usually chosen over lump sum payment when it comes to settling a case or lawsuit that involves compensation for a large amount of money. The structured settlement is typically preferred because of the amount of cash that is usually involved.
In the USA the majority of personal injury cases as well as other lawsuits are settled (outside the court) through structured settlements. When you settle you need somebody to purchase your settlement for a lump sum because it’s your money and you want it now.
Basically, structured settlements are cash payments done via an annuity system to compensate a person for injuries or losses suffered. Instead of the agreed compensation being paid in a one-off settlement, it is done over a fixed period of time.
The US Congress enacted laws in 1982 that recognize and set out the basic rules of engagement when negotiating structured settlement cases. This law aims to protect both parties. Since structured settlements are protected by law and Internal Revenue Service regulations (IRS), the victim can be sure that the whole amount will be paid.
The laws and regulations set out the following threshold to be used as criteria in deciding cases that can or cannot be eligible for structured settlements:
- The compensation required is over $ 10,000 and can be deferred for 3 years or more.
- A minor (a person under the age of 18) is involved the compensation required is over $5,000.
- The injured party has lost a steady stream of income and would benefit psychologically from steady income spread over a long period of time.
- The injured party has never handled the amount to be given as compensation. In this case, structured settlement prevents misuse of the compensation amount.
- The injuries suffered by the victim may require cash so as to be managed in future.
- The victim wants to avoid taxation by the IRS.
The main advantage of structured settlement is the legal protection it offers to both parties. Here are some more benefits:
Structured Settlements do not attract Tax
This cash does not attract tax both at the Federal and State level. In fact, any income that comes from investing this amount does not attract tax. Any income coming from investing a lump sum settlement attracts tax- at Federal and State level.
Structured Settlements offer Security
Since some injuries can result in loss of income (or ability to make income), payment over a long period of time offers regular income.
Structured payments are less expensive to handle
All cases involving structured payments are usually done outside the court system. This saves time and cash for both parties that would be lost following the court process.
Managing a structured settlement is less Stressful
If you get a lump sum amount, you will have to worry about investing the amount so as to provide regular income. Structured payment is by itself regular income and thus easier to manage.
For you to get the most from your structured settlement case, you will need professional help and advice. At Einstein Structured Settlement, we walk with you to ensure you get the most amount of money from your case.
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