When a person recovers money for a tort injury committed by another person, an historic source of exclusion of that recovery from income tax is Section 104(a)(2) of the Internal Revenue Code. The current version of this exclusion exempts from federal income tax: “the amount of any damages (other than punitive damages) received (whether by suit...
For so many people starting a business and watching it succeed through hard work, courage, and a little bit of luck is the American dream. This certainly embodies the journey our team at Independent Life has experienced. As a result of those factors and the growing support of settlement professionals and attorneys across the country,...
IRC vs. SSA Every structured settlement and settlement planning professional is presumably well-familiar with the Internal Revenue Code definition of Gross Income in IRC 61 as well as the exclusion for periodic payments in IRC 104(a)(1) and (2), plus many other Internal Revenue Code Sections (130; 468B; 5891) and tax concepts (constructive receipt; economic benefit) that have become the foundation...
Medicare Set-Asides A self-insured municipality referred a case involving a 54-year old police officer who sustained catastrophic injuries attempting to take a suspect into custody. The Case The police officer received conservative treatment initially and eventually underwent multiple surgeries to aid his recovery. After his surgeries, complications arose, and he was living in constant...
Since The ABLE Act created IRC 529A in 2014, ABLE accounts have become popular financial and settlement planning tools for qualifying disabled individuals. The ABLE Act allows states to create tax-advantaged savings programs for eligible people with disabilities that began prior to age 26. Funds from these 529A ABLE accounts can help designated beneficiaries pay for qualified disability expenses. Distributions are...
A 40 year-old male employee was catastrophically injured during an auto accident resulting in paraplegia and a traumatic brain injury (TBI). The adjuster for the self-insured employer referred this challenging workers’ compensation claim to Independent Life. The Case The injured worker spent the last two years in and out of facilities stacking up costly medical...
Revisiting the Grillo Case The Christina Grillo medical malpractice case reached a $2,500,000 settlement in Texas in 1990 – thirty years ago. Why is the case still important today? And why, like two other historical industry events which occurred in 1990 (the Uniform Periodic Payment of Judgments Act and the Americans with Disabilities Act), is it worth revisiting? Most structured...
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Any discussion of taxes herein is for general informational purposes only and does not purport to be complete or cover every situation. Independent Life, its affiliates, its distributors, and its and their respective representatives do not provide tax, accounting, or legal advice. You should confer with your qualified legal, tax and accounting advisors based on your particular circumstances. All guarantees are obligations of Independent Life Insurance Company.
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