Structured Settlements: Selling Your Payments
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The advantages one can get from having a structured settlement annuity are quite a few. Structured settlement payments are advantageous in providing financial security on a long term basis for you and your family and the payments as well as interest earned are free from taxes. In case you need the money for any emergent situations or you find that you can invest this money in a better way you are entitled to do it as per law.
The federal law HR 2884 permits you to sell your structured settlement payments without paying any taxes. In addition to federal laws, more than two-thirds of states in the United States allow the sell of structured settlement payments. The most important thing in this is that in both the cases the sale has to approved by a court.
Selling Your Structured Settlement
It is not difficult to get approval of the court for selling part or full quantum of your structured settlement payments provided you are able to prove your genuine requirement for money. The presiding judge will go through your case and give his judgment based on whether this sale will be in you and your family’s interest or not.
As long as you are an adult of sound mind, and you can proved that you and your dependents will benefit from the transaction, the judge has very little reason to deny your case. If you appear in the court on the hearing day your chances of getting court approval will be high. Court approval is not mandatory for selling your structured settlement payments; however the amount and interest will be taxed.
In most cases, the purchasing company you are working with will still buy your structured settlement payments. To facilitate finalization of the sale they will handle necessary legal formalities. They might not charge you for this extra effort; you must realize that you may have to pay taxes on the money received in the absence of court approval.
Quotations have to be obtained from various purchasing companies for purchasing the settlement. It is always beneficial for you to get multiple quotes. You must choose the company with whom you want to proceed further and after selecting this company you should send the copies of the structured settlement policy to the purchasing company. A disclosure document will be sent by the purchasing company asking you to sign. This document basically gives the conditions of this transaction. You must scrutinize the document thoroughly, sign it and return to the purchasing company.
Next, the court order process will begin. Depending on your state of residence and your insurance company, the process can take up to 90 days. Under normal circumstances you will receive your money within 10 days after court approval.
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