How to Sell a Structured Settlement
Structured settlements are an alternative to lump sum payouts that provide financial security for people who win or settle a personal injury lawsuit.
Sometimes, structured settlements can be the solution when it comes to covering large bills or emergency needs that require cash right away. This can be the answer for a variety of situations, such as medical bills or home mortgages.
Tax-free periodic payments
If you have been awarded a structured settlement in a personal injury case, you may be able to sell some or all of the payments you have received. This process is commonly known as factoring. However, before you start the process, it is important to understand your rights and responsibilities as well as the tax implications of selling your payments.
Structured settlements are meant to provide regular income to people who have been injured by the negligence of another party. These payments are usually spread over several years and can be arranged in annuities or insurance policies.
The main advantage of these structured settlements is that they are tax-free. According to the IRS, any damages that are received by suit or agreement for personal injuries and physical sickness do not qualify as income under Internal Revenue Code SS104. In fact, the law also excludes amounts received from workers’ compensation cases involving physical injuries or illness.
Historically, the majority of structured settlements were paid out in lump sum cash payments, which was not a desirable option for many injured individuals. In addition, these lump sums were often misspent and not available for future needs.
In the 1980s, a new settlement arrangement was introduced that gave injured persons a way to receive periodic payments. This type of settlement is now called a structured settlement and can be used in cases involving both personal injuries and wrongful death.
A properly designed structured settlement provides tax-free payments to the victim or their family members. This is because the IRS recognizes that the money is not considered traditional income and does not tax it accordingly.
This is one of the reasons why structured settlements have become so popular. They offer a guaranteed income and can help people avoid the hassle of managing large amounts of money.
Furthermore, the payments are often less expensive than lump sum cash because they take into account inflation. This makes them a better deal in the long run.
If you want to sell your structured settlement payments, it is important to work with a trusted company that has been in business for a while and is licensed to purchase payment streams. You must also ensure that the transaction fits your longer-term financial goals.
Access to cash
Structured settlements and annuity payment streams are a convenient option for many personal injury claimants. They provide periodic payments that are tax-free and do not affect a person’s eligibility for disability or Social Security benefits.
However, there are times when a recipient may need access to cash more quickly than the periodic payment schedule allows. This can be the result of a major financial hardship such as job loss, medical bills, home repairs, or college tuition fees.
For this reason, it is often possible to sell the structured settlement and receive a lump sum of cash immediately. This can be done by working with a reputable structured settlement buyout company.
The process is simple and streamlined, but you will need to complete some paperwork and appear in court to receive the money. Typically, a judge will approve the sale of your settlement if you can demonstrate that it is in your best interest to sell.
One of the most common reasons for selling your structured settlement is to pay for medical bills. In this case, you should bring all your medical statements and health insurance policy to the courthouse so that a judge can determine that there is an immediate need for cash.
Another reason to sell your structured settlement is to invest the proceeds in a new business. If this is your goal, you should contact an attorney or investment adviser before you make a decision.
A third reason to sell your structured settlement is to use the cash for a major purchase, such as a home or car. If this is the case, you should be prepared to explain why you need this large sum of money.
Finally, if you have a minor child who received a structured settlement and circumstances have significantly changed since the settlement was ordered, a parent or legal guardian can sell the right to future payments to the court to obtain a lump sum of cash. This is a highly-guarded and regulated process and requires that you prove to the court that selling your annuity is in the best interests of your child.
Flexibility
Every so often great opportunities arise, whether it’s getting out of debt, starting a business, going back to college, or simply making a better life for you and your family. Sometimes, however, these opportunities require a large amount of money at once.
When this happens, many people choose to sell some or all of their structured settlement payments for a lump sum to address the immediate need. This can give them the flexibility they need to pursue their goals without the financial strain of paying for new debt.
This can be particularly helpful when the cash needed comes from a major expense, like a home loan or medical bills. It also can provide peace of mind knowing that you will be able to pay for these expenses without fear of depleting your savings or incurring crippling debt.
Moreover, this option can help you better prepare for any other unforeseen monetary needs in the future. For example, if you sell your payments, you can use this cash to pay down debt, start a business, or invest in an exciting new project that will be beneficial for you and your family.
In addition to allowing you to sell some or all of your structured settlement payments for a lump sum, you can also sell only a specific number of payments, a predetermined dollar amount, or a combination of both. By choosing this option, you can have the benefits of a lump sum cash payout along with the financial stability that comes with regular monthly payments.
If you’re considering selling a portion of your structured settlement payments, it’s important to do your research and find the right buyer for your specific situation. This will help you ensure that you receive the best possible price for your money.
A good buyer will be willing to work with you to determine the best deal for your situation and provide assistance during the sale process. They will also be able to help you navigate the laws and regulations surrounding selling your payments.
Selling your structured settlement payments is a big decision that should not be taken lightly. It can affect your retirement plans, Social Security payments, and tax obligations. The key is to make an educated decision that is best for you and your family.
Reputable buyers
Structured settlements are a great way for victims of personal injury lawsuits to achieve financial security over a long period of time. They provide plaintiffs with tax-free periodic payments and can be structured to meet specific investment goals or needs. However, as life events change, some plaintiffs find themselves in need of cash quickly and wish to sell their structured settlement payments.
Fortunately, there are many structured settlement buyers who offer reputationable services. These companies have years of experience buying structured settlements and can help you get the most money possible for your settlement.
The first step to selling your structured settlement is choosing the right buyer. It’s a good idea to get quotes from several structured settlement buying companies to compare them and see which one offers you the best price. The prices of each quote are based on the “time-value” of your money, meaning that it’s worth more now than later.
A reputable company will take the time to understand your situation and will work with you at a comfortable pace so you don’t feel pressured or confused. They will also listen to your concerns and ensure you get the most out of the structured settlement buyout process.
Peachtree Financial Services is a structured settlement company that focuses on customer service and works with only one representative to guide you through the whole process. Their policy ensures that you won’t have to explain the same details over and over again.
Another reputable buyer is Fairfield Funding, which provides personalized and professional services. It offers competitive rates, quick transactions and no-interest cash advances. Its website features informational videos and the 100% guarantee, which guarantees that you will receive the lowest price for your settlement.
Before you decide to sell your structured settlement, meet with a legal or financial expert who can help you evaluate the tax and other implications of cashing out. You can also use the Internet to research potential buyers and read testimonials from past customers. It’s also important to look for a company that is open and accessible throughout the day.
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