Structured Settlement Transfers

Structured Settlement Transfers

Structured settlement transfers occur after a settlement has been agreed on to be paid out over time, and the person receiving the settlement payments find the need to sell all or parts of the payments to a third party.

These settlements are typically a result of a lawsuit, or sometimes from a lottery and jackpot winnings. They usually go through an insurance company or another financial institution to insure the payments.

The process to sell or transfer these payments is easily navigated with knowledgeable professionals.

This site can guide you through the process:

Legal Benefits in Choosing to Sell Some or All of Your Structured Settlement Rights

Around ten years ago, Congress instructed the IRS to not only provide benefits or tax relief to those wishing to sell their structured settlement rights, but to also provide incentives.  In 2002, these laws were put into place providing even more standards for this industry; for both the person trying to sell and the companies trying to buy.

Congress saw that because of lack of industry standards and no regulation, the public was being harmed when trying to sell their structured settlements.  Now all interested parties get to enjoy some protection:

  1. For the first time, sellers of their structured settlements and their attorneys now have definitions, procedures, guidelines and some protection under the Internal Revenue Code to help them transfer structured settlement payment rights.
  2. People who have sold structured settlement payment rights now have some tax clarification and assurance.
  3. For the first time, people who are currently interested in trying to sell structured settlement payment rights get to receive guidance on how, and under what circumstances, they can sell those payment rights.
  4. Now, the seller wishing to sell some or all of their structured settlement payment rights can take the time to consider whether and how to best facilitate future transfers of structured settlement payment rights; take the time to reevaluate existing structured settlement products in order to obtain sound financial and insurance plans; take the time to review and understand ALL documents used in the sale of structured settlement payment rights.

It never used to be this way.  Selling some or all of your payments is perfectly legal and structured settlement annuity owners and issuers as well as state judges, can expect increased applications for approvals of factoring transactions under stated protection statutes.