Nothing can replace the memories of your loved ones after their death. However, there are times when the death could have been avoided but occurred because of the negligence of someone else. We find typical examples in situations where a diagnosis of an asbestos induced cancer, such as mesothelioma or cancer of the lung, could have been avoided, if an employer had been taken care of his responsibilities. In cases such as these a wrongful death settlement may be awarded by a civil court. If you receive a settlement offer there are a few things to keep in mind when making your decision.
If you are offered a settlement for the wrongful death of your loved one you will need to choose whether or not to accept a lump sum or a structured settlement. Generally, you will be offered a smaller amount in a lump sum. A structured settlement will be paid out in even payments over a designated period of time. This may be monthly or yearly depending on what the defendants may be offering. Your attorney will help you decide which option is in your best interest and may be able to negotiate larger sums and better terms for your wrongful death lawsuit settlement.
Wrongful death settlements are not considered taxable by the IRS. In many states punitive damages in a claim are taxable; however, they are exempt in cases of wrongful death. Although a large wrongful death settlement may push the deceased’s estate over the tax exempt limits of the inheritance laws. Always consult a good tax attorney and a CPA so there is no doubt about any taxes that may be due. Spending a small sum up front may save tens of thousands of dollars later on.
There are a number of reasons the need may arise to convert your structured payments into a lump sum of cash. Perhaps a wonderful business opportunity has presented itself; however, without the cash of the settlement a deal cannot be closed. Or, unfortunately some people will be diagnosed with terminal diseases and wish to use the money to enjoy the last few years of their lives. In cases such as these there are companies that specialize in paying you a lump sum in exchange for yours structured payments. These companies profit by offering you a lower amount than the total of the payments still do. In this case these lending institutions are guaranteeing themselves a certain percentage profit on their investment. Most settlement payments are coming from very strong insurance companies, so their investment is deemed very safe. You will give up a good portion of your settlement by utilizing one of these companies; however, if the money can be enjoyed today instead of being left to other heirs, the high price may be worth it.