Selling your Structured Settlement Payments
The benefits that you can get by owning a structured settlement annuity are invaluable. Structured settlement payments provide long term financial security for you and your dependents, and the payments and earned interest are tax free. However, if you need the money or simply have better investment options, you are entitled to it.
You can sell your structured settlement payments legally in US as per the federal law HR 2884, and this sale can be made without your paying any tax. The sale of structured settlement payments is allowed not only in federal laws but also in the state laws of the two-thirds of the states in the United States. In order to become eligible for selling this without paying any taxes you should get the prior approval of the 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 approval or otherwise will be given by the judge after reviewing your case to decide whether you require this money for a transaction that will benefit you and your dependents.
The judge might not refuse court approval for selling your structured settlement payments if you are an adult with a sound mind and also if you can prove that this sale is beneficial to you and your family. Keep in mind that appearing at the hearing may help your cause. 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. They may also be willing to handle the legal issues to facilitate finalization of this sale. 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. 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. You will receive from the purchasing company a disclosure document which you are expected to sign. This document contains the clauses and conditions of the transaction. You must scrutinize the document thoroughly, sign it and return to the purchasing company.
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. Once court gives approval it might take 10 days to get your money.
