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Old 03-09-2017, 07:48 AM   #1
Burt44
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Default Judgment award paid over time?

I this week received a settlement judgment for 23,000 dollars for fairly serious injury to my arm,

Can I elect to take that over time - say over 5 years - or must I take the amount all at once?

Will i have to pay tax on that?


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Old 03-09-2017, 09:32 AM   #2
AFFA
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Default Re: Judgment award paid over time?

I wish to inform you that other party is liable to pay you at present. However with consent of both parties payment may be scheduled over five years. Further there may not be any tax as compensation is for injury and may not be regarded as income. However if in past years you have claimed deduction of medical expenses then you may be liable to tax for the amount of deduction taken by you.

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Old 03-09-2017, 12:48 PM   #3
adjusterjack
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Default Re: Judgment award paid over time?

Quote:
Originally Posted by Burt44 View Post

Can I elect to take that over time - say over 5 years
You can.

But it's always better to take it all at once so you have control of the money. You can put it in a separate account and just draw on it as needed or you can buy yourself a single premium annuity that will pay you monthly for as long as you want to set it up for.

Quote:
Originally Posted by Burt44 View Post

Will i have to pay tax on that?
Personal injury settlements are generally not taxable but, as AFFA notes, could have some tax.

Read the following from the IRS website:

https://www.irs.gov/pub/irs-pdf/p4345.pdf
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Old 03-10-2017, 05:27 AM   #4
Lexus
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Default Re: Judgment award paid over time?

Generally physical injury compensation is not taxable. Once a judgment regarding settlement is entered the other party is obliged to pay the amount within the stipulated time. If you demand a future date and the other party agrees it, there will be no legal issue.
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Old 03-10-2017, 08:27 PM   #5
Wenton2
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Default Re: Judgment award paid over time?

Your award generally should not be taxable but you cannot take it over time, they will pay you and then what you do with it and how you structure it is up to you.
If an insurance company is involved in the payment it is possible that they may work out a payment arrangement over time.
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Old 03-12-2017, 08:05 AM   #6
olive
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Default Re: Judgment award paid over time?

Your bank of financing advisor can also work out arrangements where you are paid over time.
There are fees involved and it can get complex but it can be done if there is a truly compelling need to do so.
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Old 03-17-2017, 02:48 AM   #7
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Default Re: Judgment award paid over time?

If an insurer is involved, they will often LIKE to pay you over time.
I received 20,000 dollars for falling down a stairs and breaking my arm (no room lights and no warning of stairs) and they insisted it be paid over time.
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