Get A LUMP SUM for Your Structured Settlement
IRS Post Related to Structured Settlements
As of June 2006, the following states had enacted SSPAs requiring that transfers of structured settlement payment rights receive advance court (or, in some cases, administrative authority) approval. (Since July 1, 2002, every transfer of payment rights has required such approval in order to avoid the federal excise tax.)
| State | Citation for SSPA | Prior Court or Admin. Approval Required? | Best Interest / Hardship Finding Required? | Miscellaneous |
|---|---|---|---|---|
| Alabama Eff Date: 07/01/2006 |
Act 2006-628 | Yes | Yes | Payee be given detailed financial and legal disclosures before transferring payment rights |
| Alaska Eff. Date: 08/12/2003 |
Alaska Code § 09.60.200 & § .09.60.23 | Yes | Yes | Disclosure of Key Terms to payee required. [ 1 ] Payee must receive independent professional advice regarding implications of the transfer |
| Arizona Eff. Date: 05/20/2002 |
Arizona Code § 12-2901 to § 12-2904 | Yes | Yes | Payee must be advised in writing to seek independent professional advice. |
| Arkansas Eff. Date: 08/12/2005 | Ark. Code Ann § 23-81-701 through § 23-81-707 | Yes | Yes | |
| California Eff. Date: 01/01/200 | California Insurance Code § 10134 to § 10141 | Yes | Yes | Transferee required to advise payee of right to seek counsel in connection with transfer petition and to advise that transferee will pay fees of payee's counsel up to $1500. Copy of transfer agreement must be filed with state Attorney General’s Office. Cannot factor structured settlements of claims for workers comp. benefits. |
| Colorado Eff. Date: 07/01/2004 |
Colorado Statutes § 13-23-102 to § 13-23-108 | Yes | Yes | Payee must be advised in writing to seek independent professional advice. Cannot factor structured settlements of claims for workers comp. benefits. |
| Connecticut Eff. Date: 10/01/1998 |
Connecticut Statute § 52-225f | Yes | Yes | Payee must be advised in writing to seek independent professional advice. |
| Delaware Eff. Date: 07/26/2000 |
Delaware Code, title 10, § 6601 & § 6602 | Yes | Yes | Payee must receive independent financial advice. |
| Florida Eff. Date: 10/01/2001 |
Florida Statute § 626.99296 | Yes | Yes | Payee must receive independent financial advice. Cannot factor structured settlements of claims for workers comp. benefits. |
| Georgia Eff. Date: 07/01/1999 |
Georgia Code § 51-12-70 to § 51-12-77 | Yes | Yes | Payee has 21 days to cancel. |
| Hawaii Eff. Date: 05/26/2006 |
HB1977 HD1 SD2 | Yes | Yes | Disclosure of Key terms to payee. |
| Idaho Eff. Date: 07/01/2001 |
Idaho Code § 28-9-109 | Yes | Yes | Transferee must advise payee to seek professional advice. Cannot factor structured settlements of claims for workers comp. benefits. |
| Illinois Eff. Date: 01/01/1998 |
Illinois Statute § 153 (215 ILL) | Yes | Yes | Transferee must advise payee to seek professional advice. |
| Indiana Eff. Date: 06/30/2001 |
Indiana Code § 34-50-2-1 to § 34-50-2-11 | Yes | Yes | Cannot factor structured settlements of claims for workers comp. benefits. |
| Iowa Eff. Date: 07/01/2001 |
Iowa Code Ann § 682.1 through § 682.7 | Yes | Yes | |
| Kansas Eff. Date: 07/01/2005 |
2005 House Bill no.2160 | Yes | Yes | Cannot factor structured settlements of claims for workers comp. benefits. |
| Kentucky Eff. Date: 07/15/1998 | Kentucky Rev. Statute § 454.430 to § 454.435 | Yes | Yes | Disclosure of Key Terms to Consumer required. [ 2 ] Cannot factor structured settlements of claims for workers comp. benefits. |
| Louisiana Eff. Date: 08/15/2001 |
Louisiana Sess. Law Serv. § 9.2715 | Yes[ 3 ] | No [This omission means that the Louisiana SSPA is not an “applicable State statute” as defined in section 5891(b)(3)] | Court must find that Payee received independent professional advice. Cannot factor structured settlements of claims for workers comp. benefits. |
| Maine Eff. Date: 09/18/1999 |
Maine Rev. Statute Ann. Title 24A § 2241 to § 2246 | Yes | Yes | Payee required to receive independent professional advice. Interested parties must consent to transfer if settlement documents bar assignment of payments. |
| Maryland Eff. Date: 10/01/2000 |
Maryland Courts and Judicial § 5-1101-5-1105 | Yes | Yes | Payee must receive independent professional advice. Cannot factor structured settlements of claims for workers comp. benefits. |
| Massachusetts Eff. Date: 01/12/2001 |
Massachusetts Ann. Laws chapter 231C § 2 | Yes | Yes | Payee must receive independent professional advice. |
| Michigan Eff. Date: 01/14/2001 | Michigan Comp. Laws § 691.1191 to § 691.1197 | Yes | Yes | Payee must receive independent professional advice. Interested parties must consent to transfer if settlement documents bar assignment of payments. Discount/interest cannot exceed 25% per year. Cannot factor structured settlements of claims for workers comp. benefits. |
| Minnesota Eff. Date: 08/01/1999 |
Minnesota Statute § 549.31 to § 549-34 | Yes | Yes | Payee must receive independent professional advice. Cannot factor structured settlements of claims for workers comp. benefits. |
| Mississippi Eff. Date: 08/01/200 | Mississippi Code Ann. § 11-57-1 to § 11-57-152 | Yes | Yes | Factor must advise payee in writing to seek professional advice. |
| Missouri Eff. Date: 08/28/1999 |
Missouri Rev. Statute § 407.1060 to § 407.1068 | Yes | Yes | Court must find that payment to be made to payee equals "the fair market value of the structured settlement rights being transferred." Cannot factor structured settlements of claims for workers comp. benefits. |
| Montana Eff. Date: 10/01/2005 |
Mont. Code Ann. § 33-20-1401 through § 33-20-1412 | Yes | Yes | Cannot factor structured settlements of claims for workers comp. benefits. |
| Nebraska Eff. Date: 01/01/2002 |
Nebraska Rev. Statute § 25.3101 to § 25-3107 | Yes | Yes | Cannot factor structured settlements of claims for workers comp. benefits. Payee must be notified of right to professional advice. Discount/finance charge cannot exceed maximum interest rate for a consumer loan. |
| New Jersey Eff. Date: 08/02/2001 |
New Jersey Statute Ann. § 2A:16-63 to § 2A:16-69 | Yes | Yes | Payee must be notified of right to professional advice. |
| New Mexico Eff. Date: 07/01/2005 | New Mexico Stat. Ann. § 44-9-1 through § 44-9-7 | Yes | Yes | |
| New York Eff. Date: 09/17/2002 |
New York General Obligation § 5-1701 to § 5-1709 | Yes | Yes | Payee must be notified of right to professional advice. Transfer agreement may not require payee to pay (i) the transferee's attorneys' fees or costs if a transfer is not completed, or (ii) any federal tax liability (other than the payee's own tax liability). Cannot factor structured settlements of claims for workers comp. benefits |
| Nevada Eff. Date: 05/29/2003 |
N.R.S. § 42.030 | Yes | Yes | |
| North Carolina Eff. Date: 10/01/1999 |
North Carolina General Statute § 44B-1-543.10 to § 44B-1-543.15 | Yes | Yes | Payee must receive professional advice. Discount/interest rate cannot exceed prime + 5%; fees cannot exceed 2% of net amount payable to payee. Cannot factor structured settlements of claims for workers comp. benefits. |
| Ohio Eff. Date: 10/27/2000 |
Ohio Rev. Code Ann. § 2323.58.1 to § 2323.58.7 | Yes | Yes | Payee must receive professional advice. Cannot factor structured settlements of claims for workers comp. benefits. |
| Oklahoma Eff. Date: 11/01/2001 |
Oklahoma Statute Title 12 § 3228 to § 3245 | Yes | Yes | Transferee must advise payee in writing to seek professional advice. |
| Oregon Eff. Date: 01/01/2006 |
Ch 173 Oregon Laws 2005 (2005 S.B. 645) | Yes | Yes | |
| Pennsylvania Eff. Date: 04/11/2000 |
40 Pennsylvania Statute § 4001 to § 4009 | Yes | Yes | Transferee must advise payee to seek professional advice or sign waiver of advice. |
| Rhode Island Eff. Date: 08/13/2001 | Rhode Island Code R. § 27-9.3-1 to § 27-9.3-7 | Yes | Yes | Transferee must advise payee to seek professional advice. |
| South Carolina Eff. Date: 06/13/2002 |
South Carolina Code Ann. § 15-50-10 to § 15-50-70 | Yes | Yes | Transferee must advise payee in writing to seek professional advice. Cannot factor structured settlements of claims for workers comp. benefits. |
| South Dakota Eff. Date: 07/01/2001 |
South Dakota Codified Laws § 21-3B-1 to § 21-3B-12 | Yes | Yes | Transferee must advise payee to seek professional advice. |
| Tennessee Eff. Date: 06/23/2000 |
Tennessee Code Ann. § 47-18-2601 to § 47-18-2607 | Yes | Yes | Factor must advise payee to seek professional advice. Cannot factor structured settlements of claims for workers comp. benefits. |
| Texas Eff. Date: 09/01/2001 |
Texas Civ. Prac. & Rem. § 141.001 to § 141.009 | Yes | Yes | Transferee must advise payee in writing to seek professional advice. |
| Utah Eff. Date: 05/06/2002 |
Utah Code Ann. § 78-59-101 to § 78-59-10 | Yes | Yes | Transferee must advise payee in writing to seek professional advice. |
| Virginia Eff. Date: 07/01/1999 |
Virginia Code Ann. § 59.1:475 to § 59.1:477.1 | Yes | Yes | Factor must advise payee in writing to seek professional advice. |
| Washington Eff. Date: 07/22/2001 | Washington Rev. Code § 19.205.010 to § 19.205.900 | Yes | Yes | Transferee must advise payee in writing to seek professional advice. |
| West Virginia Eff. Date: 06/11/1999 |
West Virginia Code Statute R. § 46A-6H-1 to § 46A-6H-8 | (ii) the transferred payment rights total more than $40,000.00 or (iii) the settlement agreement contains a provision restricting assignment of payments. rights. |
Yes | Cannot factor workers’ compensation claims. Court approval only for: lump sum payment exceeds 40,000. Settlement payments to infant or incompetent, Personal injury payments, and others. |
| Wyoming Eff. Date: 07/01/2006 |
Senate File 009 | Yes | Yes | |
Table Footnotes: 1. Every SSPA requires disclosure of key terms to the payee. 2. The Kentucky SSPA includes this requirement, but it effectively is a nullity, because any payee who enters into a factoring transaction will inevitably have consented to the transaction. 3. The Louisiana SSPA provides for authorization of a transfer by ex parte order. |
||||
Of the four states that have not yet enacted SSPAs, several, including Alabama and Wisconsin, are expected to consider legislation in 2006. Some of the states that have not enacted SSPAS, such as Vermont and Hawaii, are the same states which are known for lax insurance laws and home to domestic captive insurance companies.
Tax Reported on:
For transactions that do not meet the conditions for exemption under section 5891(b), the 40% excise tax is reported on Form 8876; with the first return due date of no later than May 20th, 2003 for all structured settlement payment rights received before February 20th, 2003 and after February 21st, 2002. After February 19th, 2003, the Form 8876 must be filed by the 90th day following the receipt of structured settlement payment rights in a structured settlement factoring transaction. Extensions can be obtained by filing Form 7004, Application for Automatic 6-Month Extension of Time to File Certain Business Income, Information, and Other Returns, by the due date of Form 8876. Form 7004 does not extend the time for payment of the tax.
see more at IRS.gov
Click below links to find structured settlement local information by state.
|
|
|
|
|
|
Structured Settlement Help Pages
|
SETTLEMENT HOT TOPICS
|
Structured settlements or annuities may be issued by these companies below.Insurance Company If you have a structured settlement annuity from any of these insurance companies you may be able to cash them in and transfer the future payments for lump sum of cash now. Receive cash for future annuity lawsuit payments. Click here and get a free quote for a structured settlement transfer.
|
|
Settlement Related MediaStructured Settlements and Periodic Payment Judgments ISBN 1588520374 Settlement Agreements in Commercial Disputes ISBN 073551478X
|
|
Settlement Related NewsIRS Post on Structured Settlements...California - Transferee required to advise payee of right to seek counsel in connection with transfer petition and to advise that transferee will pay fees of payee's counsel up to $1500...Read More >. Michigan Revised Structured Settlement Protection...The transfer is in the best interest of the payee, taking into account the welfare support...Read More >.
|