by John Darer CLU ChFC MSSC CeFT RSP CLTC
Your "dating habits" can get you into trouble when establishing structured attorney fee programs and attorney fee deferred compensation programs and structured settlements for taxable damages
Settlement agreements are contracts that obligate payment be made on a certain date. In most cases that obligation is shifted to a qualified assignment company, which purchases an annuity to fund that periodicpayment obligation to payment on a certain date. But what if it comes in early?
Avoid the agita! of payments being deposited in your account, arriving before the end of the year, in the end of the year rush, instead of after January 1.
Consider using a starting payment date at least 10 business days into January, when settlement documents are drafted.
You may also want to consider inserting language in the settlement documents that addresss when the payment date is not a business day (i.e. if the payment date is on a holiday or a weekend) that payments will be made on the next business day.
Be mindful that where January 1st (New Year's Day) comes on Monday, as it did in 2024, the preceding days are a weekend and the week before is a short week (with Christmas also on a Monday) with many on vacation and the Friday before January 1st is a half day for many, day that insurers or other payment providers may release payments early in an effort to meet their conatrctual obligations.
Pay Extra Attention to Payment Dates on These Types of Settlements
Last updated January 12, 2024