If you have a personal injury structured settlement you may find that the payments are serving you well, meeting your financial needs. Or, you may find yourself in need of a large amount of cash while receiving smaller periodic payments from a structured settlement. If this situation fits you, then you are probably wondering, “Can I sell my structured settlement payments?” The answer is, yes, you can sell personal injury structured settlement payments and put a large sum of cash into your bank account all at one time, rather than running to the mailbox month after month. Indeed, this is a legal right, even if your settlement paperwork says that you cannot sell your payments.
You Can Sell Your Personal Injury Structured Settlement Despite Your Paperwork Restrictions
In most structured settlement annuity policies there is language in the document which says that the annuitant (you) cannot assign his or her payments to anyone else. However, federal and state laws have overruled that restriction and have made it possible for annuitants to sell or transfer their structured settlement payments to someone else. This means that you can sell your future payments to a company, such as Strategic Capital, in exchange for a lump sum of cash, legally.
Understanding the IRS Code
Since 1999, 48 states have passed their own Structured Settlement Protection Acts, all of which allow annuitants to sell or transfer their personal injury structured settlement payments.
These individual state acts spell out the requirements for each transfer. In addition, in 2002, the federal government passed Internal Revenue Code Section 5891, which allows annuitants to sell their structured settlement payments, provided that the transfer is approved by a state court, in accordance with the annuitant’s state’s Structured Settlement Protection Act.
This means that the federal government specifically says that you may sell your structured settlement payments, no matter what your settlement agreement says. It also means that in 48 of the 50 states the state itself makes the same assertion (New Hampshire and Wisconsin are the only states that do not have a specific statute governing the sale of structured settlement payments – but that doesn’tmean you cannot sell your payments, speak to us and we will show you how).
Understanding the Differences from State to State
Of course, every state is different in how they approach these sales. Some states make it relatively easy, such as Florida, Virginia and Illinois, where you do not have to attend the hearing to sell your settlement, and approval is relatively fast. Some states, such as North Carolina, have a rate cap, that is, they limit how much money the company buying your settlement can charge you. This protects you, but in some cases can make a sale more difficult, if not impossible.
Getting the Money that You Need
In summary, personal injury structured settlement payments can be sold because the federal law, together with the state acts, overrule the anti-assignment language in both the annuity policies and the settlement and release agreements. The specifics required of such sales will vary from state to state. At Strategic Capital we can advise you on the specific laws in your state and tell you how things tend to go in your state as well. When you work with Strategic Capital you are always kept informed so that you can be confident that things are moving as quickly as possible and in your best interests.