Can a plaintiff purchase a structured settlement annuity himself or herself and still qualify for a tax-free benefit on the earnings?
No. If the settlement dollars are invested by the claimant, then it’s not a structured settlement. The interest earned will be subject to tax and the rates won’t be as good. Annuity rates have to do with life expectancy, competition, and premium taxes. Many insurance companies offer both regular annuities and structured annuities. They may charge 5.9% more to the same healthy person for a regular annuity than they would if it were a structured annuity. In short, they’ll pay more for the annuity and pay taxes.
Related Questions
- Can a plaintiff purchase a structured settlement annuity himself or herself and still qualify for a tax-free benefit on the earnings?
- Can a claimant purchase an annuity after the settlement and still qualify for a tax-free benefit on the earnings?
- Can the plaintiff purchase an annuity for a structured settlement and still get the payments tax free?
