Selling your Structured Settlement

The advantages one can get from having a structured settlement annuity are quite a few. First of all, you and your family/ dependents are made financially secure for a considerable amount of time because of having structured settlement payments and these payments including the interest earned on them are tax free. However, if you need the money or simply have better investment options, you are entitled to it.

The federal law HR 2884 protects individuals who want to sell their structured settlement payments to meet unplanned financial needs; this can be done without any tax implications. ) About two-thirds of the states in the United States also permit sale of structured settlement payments. However, in order to get the tax free benefit it is necessary that this transaction is approved by court.

Selling Your Structured Settlement

Getting approval for the sale of your structured settlement payments from the court is relatively easy if you have solid reasons to prove that you require this 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.

Any adult with a sound mind can get court approval for selling his structured settlement payments as long as he can prove that he and his family will get benefitted by this transaction. Your personal appearance at the trial will help in getting a positive verdict. Court approval is not mandatory for selling your structured settlement payments; however the amount and interest will be taxed.

The purchasing company with whom you are having discussions might be interested in purchasing your structured settlement payments. To facilitate finalization of the sale they will handle necessary legal formalities. They refrain from charging any fees for this effort they have taken; however, you are liable to pay tax on the money received without court approval.

First, you must get quotes. You will almost always benefit by getting multiple quotes. In case you find a suitable purchasing company out of the various quotes received, you should send to the purchasing company copies of the structured settlement policy. A disclosure document will be sent by the purchasing company asking you to sign.

This document basically gives the conditions of this transaction. It must be singed and returned.

The next step is to get the court order. Depending on your state of residence and your insurance company, the process can take up to 90 days. After receipt of court approval it takes 10 days to receive your money.