When you file a personal injury lawsuit, such as one for an accident with a semi-truck, there are a few ways that your case might be resolved. One of these ways is through a settlement. If you are able to reach a settlement in your truck accident case, you might get a lump-sum payment or you might end up with a structured settlement. While it is easy to think that a lump-sum payment might be the best option, there are some very important benefits to getting a structured settlement.
A structured settlement is one in which you are given regularly occurring payments instead of being given all of the money all upfront. One of the main benefits of the structured settlement is that they are tax-free as long as they are set up as annuities that are controlled by someone else. Annuity funds are controlled by a professional, so the funds would be tax-free as long as you don’t begin to exert too much control over them.
Another benefit is that you can request that you get a lump-sum payment in conjunction with the structured settlement. This could help you to get expenses you have already incurred paid without having to wait on the annuity payments to come in.
With any possible settlement for a personal injury case, you should carefully consider the terms of the settlement. Considering all the way that the settlement could affect you, including the fact that you won’t be able to seek more compensation later if the damages from the accident end up being more than the settlement, might have an impact on your decision.
Source: FindLaw, “Structured Settlements: Pros and Cons,” accessed Jan. 08, 2016