North Carolina Structured Settlement Protection Act
A structured settlement provides periodic payments over time for injury victims and their dependents. They are especially helpful when the victim has suffered a serious and permanent injury, known as a catastrophic injury.
These structured settlements are a key component of successful compensation claims and have long been encouraged by plaintiff attorneys, state attorneys general, legislators and disability advocates. Despite the fact that they have a long history of success, some structured settlements are being used by unscrupulous parties to take advantage of the victims and their families.
What is a Structured Settlement?
A structured settlement is a series of fixed payments that are issued to a plaintiff after they win or settle a personal injury lawsuit. Instead of receiving a lump sum, the plaintiff receives a series of regular payments from an insurance company over time.
Using a Structured Settlement offers several benefits to the plaintiff and their attorney. The primary benefit is that it makes it more difficult for the plaintiff to squander their settlement money.
This is a problem that many people face when they receive a large sum of cash. Once others find out that you are getting money from a lawsuit, they may try to take advantage of you. If you receive your settlement as a structured payment, it is harder to do this because you cannot spend the funds until they are received by you.
Another benefit of a structured settlement is that the earnings from it are tax-free. This is because the U.S. Congress passed a number of regulations aimed at protecting injured victims from paying taxes on their settlements.
In addition, a structured settlement allows guaranteed income to be transferred to a beneficiary upon the death of its owner. This can be especially helpful for people who have significant medical needs and wish to ensure that their loved ones are taken care of in case of their death.
When an injured person is awarded a structured settlement, they work with a qualified assignee to set up the annuity. This involves determining the amount of regular payments, how long they will be made, and whether the payments should increase or decrease over time.
An injured person can also choose to include a rated age, which is the age at which they will be expected to live given their medical conditions. This can greatly increase the payout on their structured settlement.
The rated age is determined by examining the defendant’s medical records and comparing them to the average life expectancy for people with similar health issues. This can increase the monthly annuity payout for a plaintiff.
In addition, structured settlements can be used to pay mortgages or cover other expenses that require ongoing funding. They are also great ways to help families of wrongful death victims maintain their public benefits.
What is the North Carolina Structured Settlement Protection Act?
The North Carolina Structured Settlement Protection Act is a state law that prevents structured settlement payments from being sold, transferred or pledged without the consent of the owner. The legislation also prohibits annuities from being sold and used as collateral for loans.
These laws are intended to protect consumers from predatory companies that sell or transfer structured settlement payment rights for a fraction of the value, and to stop courts from approving transfers of structured settlements in situations that are unlikely to result in a hardship.
A structured settlement is a type of settlement that is negotiated between an injured party and a tort-feasor, or another person who is responsible for causing the injury. It typically involves a long-term, tax-free income stream that is designed to provide support for the injured person throughout their lives.
In some cases, a tort-feasor can be forced to pay the injured party a lump sum of money for their injuries, but many prefer the option of structured settlements because they can be more flexible and offer more security.
An injured party may choose to settle their case by entering into a structured settlement agreement with a structured settlement company, which will then make periodic payments for the injured person. This type of arrangement can be especially helpful if the injured party is struggling to pay for their medical bills, or if they are facing a financial crisis.
According to the National Association of Settlement Purchasers, many people who are awarded structured settlements find them to be helpful in the event of a financial emergency. These payments can help to secure affordable credit, and they are also a way for people to plan for their futures.
However, a recent investigation by the Myrtle Beach Sun News and McClatchy newspapers raised concerns about a growing industry that purchases structured settlements for a tiny fraction of the value. While some people are satisfied with their refinancing deals, others say the practice has been exploitative.
The North Carolina Structured Settlement Protection Act, which was recently passed in the state, aims to curb the growing trend of unscrupulous companies snatching up structured settlement payments for a small fraction of their worth. While some cases have turned out to be quite scary, most structured settlement buyers are honest and reliable, and the majority of these transactions are not illegal.
How does the North Carolina Structured Settlement Protection Act work?
For victims of personal injury and medical malpractice, a structured settlement provides a way to get money at regular intervals over a long period of time. These periodic payments can be designed to meet the victim’s needs, such as paying for college years for a child or providing a steady source of income for an adult.
These settlements are generally tax-free, as the proceeds of a structured settlement are shielded from income taxes by federal law. In addition, a structured settlement can be treated as an annuity contract for tax purposes.
This type of payment is especially helpful for a victim who suffered a catastrophic injury and may need a large sum of money to cover long-term care costs. Unlike lump sum payments, these structured settlements can provide long-term income that is both tax-free and affordable.
However, this type of payment can also be exploited by unscrupulous people who try to sell the rights to a settlement in order to obtain larger infusions of cash. This type of abuse, known as structured settlement factoring, is illegal in many states.
The North Carolina Structured Settlement Protection Act is one of many state laws enacted to protect structured settlement holders from these abusive practices. The law is designed to ensure that structured settlements are only sold when it’s in the best interest of the holder.
These laws are backed and encouraged by the United States government to protect the interests of those who receive structured settlements. Moreover, they are designed to help injured persons maximize the tax benefits of their structured settlements.
In order to be a successful transferee of a structured settlement payment right, the buyer must register as a structured settlement transferee with the relevant state agency in the jurisdiction where the transaction will take place. For example, if the transaction takes place in Maryland, District Settlements must register with the Office of the Attorney General.
The act also requires the buyer to secure consent from a number of protected parties, including the annuity issuer and the structured settlement obligor, before acquiring their rights to a structured settlement. This includes requiring the buyer to provide signed originals of their consents and waivers to these parties, as well as copies of these documents to any protected party who requests them.
How can I sell my structured settlement in North Carolina?
Structured settlements are a long-term source of income that can help victims of personal injury and other lawsuits pay off medical bills, mortgages, and other expenses. They are also a great way to fund future needs, such as college tuition or retirement.
One benefit of receiving structured settlement payments is that they are usually tax-free. However, certain parts of a settlement, including punitive damages and attorney’s fees, can be taxable. Therefore, it is important to speak with an experienced attorney to ensure that you are maximizing the tax benefits of your structured settlement.
If you have a structured settlement in North Carolina, you may be able to sell it in order to access more cash. Selling your structured settlement is a common option among personal injury victims who are struggling to make ends meet.
When selling your structured settlement, you need to be sure that the sale is in compliance with state and federal laws. If you’re unsure of how to proceed with this type of transaction, contact an experienced North Carolina structured settlement transfer lawyer at Crawford & von Keller, PLLC for guidance.
The process for selling your structured settlement can take between 45 and 90 days on average. You will need to provide certain information and complete various forms. In addition, you will need to get the approval of a court.
Another step you need to take is to find a qualified buyer of your structured settlement payments. There are several companies that offer this service.
Once you’ve found a company that fits your specific requirements, it will begin the legal process of purchasing your structured settlement payment rights. The seller of your payments must disclose the aggregate amount, discounted present value, and gross advance amount before the purchase takes place.
It is important to note that the buyer of your structured settlement payments must be registered as a transferee in the state in which they operate. Some states, such as California, have stricter regulations that require these buyers to register with the local office of the state attorney general.
You should never sell your structured settlement to a factoring company without speaking with an attorney first. It is a complicated transaction that can be difficult to navigate. A knowledgeable structured settlement transfer lawyer can guide you through the entire process and help you avoid any legal pitfalls along the way.
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