The USPTO approved an alternative approach to claim the term “structured settlement” for companies that obtain structured settlements as a result of personal injury claims. The new application first met with several USPTO opposition to the initial application.

These concerns centered on issues regarding how the term should be defined and whether the applicant was able to meet the standards required for approval. After some time during which the USPTO considered the issue from a standpoint that provided reasonable grounds for refusing the application, the USPTO released the revised wording in August of that year. This is essentially a new approach that applies to all types of claims.

Now, instead of only those who receive structured settlements as a result of personal injuries, can we also include certain types of businesses in this list of qualifying companies?

Yes, you can. This new listing allows any business that purchases structured settlements from a member of the Structured Settlement Company to also be included in the definition of the term. In addition, the Business Opportunity Act of 2021 allows companies that are related to any aspect of the business to qualify for inclusion. One of the objectives of this change was to eliminate barriers to entry into the marketplace.

Another business entity that is now able to benefit from this change is the annuity brokerage firm. Annuities provide structured settlements as a component of the investment. To qualify for this inclusion, the annuity brokerage must sign an agreement that includes language stating that the brokerage will only receive payments if the structured settlements company’s structured settlement services are used and the annuity is invested in the annuity.

Is it possible for a structured settlement recipient to be paid in a lump sum by a third party? Yes, you can be paid in this manner as well. The lump-sum obtained by a third party in exchange for a portion of the structured settlements will be taxed as income and must be reported on the recipient’s U.S. tax return. However, the recipient can make several withdrawals each year without having to undergo a taxable withdrawal.

Are all monies received in this manner taxable?

Yes, the payments received are subject to tax. The portions of the structured settlements that are taxable can be deducted from future estates and may be subject to gifting. However, you should consult a qualified tax advisor to determine which forms of exchanges are appropriate for your particular situation. Once you have determined which exchanges are appropriate, you will need to report any portion of the structured settlements which are not taxable as income on your U.S. tax return.

These are just some of the things you need to know about structured settlements and how to work around the law to receive your fair share of settlement money. Personal injury attorneys who specialize in personal injury cases are trained to help you obtain your deserved settlement money and fight for your rights. They can help you overcome your fears about how the process works and how to move forward after being wronged by a personal injury case.