About Non-Qualified Structured Settlements
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Structures are Utilized in a Wide Range of Claims
Defendants are no longer limited by the IRS Code Section 130 (limited to personal physical injury torts and worker compensation claims filed after 8/5/97) as to what settlements can be assigned.
Defendants can now take advantage of non-qualified structure settlements to resolve:
| Construction defect |
Harassment |
| Directors & Officers |
Legal Malpractice |
| Discrimination |
Non Physical Injuries |
| Employment Litigation |
Punitive Damages |
| Environmental litigation |
Wrongful termination |
| Errors & Omissions |
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Non-qualified Assignments
In November 2001, non-qualified assignment products were introduced to the market.
Non-Qualified Assignments allow settlements from a non-personal physical injury to be placed in a structure with guaranteed returns on a tax deferred basis with the insured being able to assign the obligation over to an assignment company. As opposed to a standard structure (physical injury) where the payments are received tax-free, taxes are applied to non-qualified structures, but paid only in the year received and only on the amount received that year. Allowing the client to grow settlements tax-deferred, and avoiding paying taxes on the entire large lump sum immediately.
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