We recently were engaged by the Guardian Ad Litem (GAL) in the case of an 11 year old boy who was struck by a care while riding his bike.
The father of the boy settled the case directly with the liability auto insurance carrier pre-suit and the GAL contacted us to ensure that the boy's settlement funds were handled appropriately.
The case settled for a total of $65,000 and $59,000 was being allocated to the structured settlement annuity for the boy as follows:
$5,000 paid immediately upon settlement
$10,000 at age 18
$20,000 at age 21
$25,000 at age 25
$35,718 at age 30
this is total benefits of $95,718!
The annuity was placed with a large life insurance company rated A+ by the A.M. Best rating agency and provided the family and GAL with the peace of mind that the young man would not receive the entire amount at age 18.
In addition, due to the use of the structured settlement annuity, all of the interest gained during the payout period ($31,718 to be exact) is INCOME TAX FREE!
To ensure that the interest income retains its income tax free status specific rules pertaining to structured settlements must be adhered to. That is one of the things we ensure if we are engaged to provide our services!
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