Certain types of settlements do not qualify for income tax exclusion via a traditional structured settlement annuity. Fortunately, a non-qualified structured settlement annuity offers guaranteed1 tax-deferred payments for a wide range of cases.
Non-qualified structured settlements are those that do not qualify for income tax exclusion under Section 104 of the Internal Revenue Code. A non-qualified assignment offers a claimant involved in a non-physical injury case the opportunity to place all or a portion of the settlement proceeds in a structured settlement.
The claimant receives the settlement funds in a series of periodic payments and is liable only for the taxes on the funds received within a given tax year. In the meantime, the pre-tax settlement funds continue to earn interest.
Why utilize a non-qualified structured settlement annuity?
- Defer paying taxes on the lump sum settlement proceeds
- Create a stable, long-term source of income
- Receive guaranteed payments1
Types of Claims
Non-qualified structured settlements can be used to resolve many different types of claims, including, but not limited to:
- Employment litigation (e.g., wrongful termination, sexual harassment, discrimination, and mental anguish)
- Construction defects
- Contract disputes
- Punitive damages
- Environmental claims
- D&O and E&O claims
Market-Based Structured Settlements
In addition to structured settlement annuities, there are other investment options available to claimants involved in non-physical injury settlements. To learn more, visit our Market-Based Structured Settlements page.
For more information about non-qualified structured settlements, contact us today.1Guarantees are subject to the claims-paying abilities of the issuing insurance company.