Structured Settlements 4Real® Blog: Structured Settlements | Settlement Planning News and Commentary

John Darer Reviews Broker's Claim that Structured Settlement Brokers Issue Annuity Policies

by Structured Settlement Watchdog

Who Issues Structured Settlement Annuity Policies?

Here's one answer...

"Structured settlement brokers...and are responsible for issuing the annuity policy to the plaintiff"- FAQ answer from the website of a California licensed insurance agent and structured settlement broker , retrieved April 29, 2023

 

According to the Insurance Information Institute however

 

"Annuities can be purchased through insurance agents, financial planners, banks and life insurance carriers. However, only life insurance companies issue policies".  See How are annuities sold? | III

 

Is an Annuity Policy "issued to the plaintiff" When a Structured Settlement Is Established?

 

No, an annuity policy is never issued to the plaintiff when a structured settlement is established. See How Structured Settlements Work | Structured Settlements Explained (4structures.com)

 

Structured settlement annuities can be purchased by Defendants, Insurance Companies for Defendants, or Qualfied Assignment Companies.

 

April is Financial Literacy Month – a month intended to raise awareness on planning for a secure financial future. It’s also a time to reflect on the state of your personal finances and explore opportunities to improve them one step at a time. 

 

Publishing what should be basic information directed to consumers, that is bereft of the accurate truth, would not be acceptable standard for someone who just passed a state insurance licensing exam, let only someone with decades of experience in structured settlements.

 

Let's try to do better, eh?

 

 

 

 

 

John Darer Reviews "Annuity Expert Advice" Website's Multiple Structured Settlement Inaccuracies

by Structured Settlement Watchdog

Shawn Plummer is President of The Annuity Expert out of Atlanta, Georgia and creator of a website, Annuity Expert Advice, that

Anyone can call themselves an expert, but then they get found out

purports to provide annuity expert advice. Unfortunately for consumers, Plummer's website continues to be laden with inaccuracies about structured settlements and cannot be relied upon in the state it was at time of publication. Today's compilation of Plummer's Crack shows that there's considerable room for improvement.

Plummer's Crack 1  

"After the settlement money is negotiated and comes to final terms, the court order will request the funds to be placed into a type of income annuity contract called structured annuities". 

• Fact is that structured settlements are negotiated.
• Court orders are only required in certain cases (minors, death cases) to approve the settlement that the parties to the claim or lawsuit have negotiated
• When one is referring to the singular, such as "a type of annuity contract" with a "plumber", one generally does not mix and match a single "universal flapper" with a plurality of "elbow joints".

Plummer's Crack 2

"The annuity is an irrevocable stream of regular payments from an insurance company, which is dictated by the court system".

• An annuity, such as  a structured settlement annuity, is an insurance product which is regulated by the state insurance department, which in certain states (such as New York) may be regulated under the more encompassing "Department of Financnial Services"
• The court system does not dictate an irrevocable stream of payments. This may be helpful The U.S. Court System Explained - Democracy Docket.
• For settlements of certain types of cases, a judge, not the court system may need to approve a settlement (e.g. minors, incompetents, or death cases) and the form of distribution. 

Plummer's Crack 3

"Structured settlement annuities are similar to either an immediate annuity or a deferred annuity. The structured settlement payments are guaranteed and irrevocable; however, the annuity settlement options can differ from typical income contracts. For example, in a structured settlement payout, the payments may increase or decrease down the road multiple times". 

• Structured settlement annuities are qualified funding assets used to fund periodic payment obligations that are part of the consideration for the settlement of a claim or lawsuit. See How Structured Settlements Work | Structured Settlements Explained (4structures.com)
• Structured settlement annuities are unique in that structured settlement annuities can accomodate multiple payment streams in a single contract. See What Are Structured Settlement Annuities? Structured Settlements FAQ (4structures.com)

Plummer's Crack 4

Not all settlement annuities are structured in a payment schedule. For example, settlement money is sometimes paid out in a lump sum within a settlement agreement.

• If there is no payment schedule there is no structured settlement. Consumers cannot just buy a structured settlement annuity. A payment schedule could be a single payment or it could be multiple types of structured settlement payments in multiple payment streams. See Types of Structured Settlement Payments | Your Structured Settlement Payment Options (4structures.com).

Prior Posts About Plummer's Crack

AnnuityExpertAdvice.Com on Secondary Market Annuity is Just "Plummer's Crack" - Structured Settlements 4Real® Blog: Structured Settlements | Settlement Planning News and Commentary (typepad.com) February 3, 2022

AnnuityExpertAdvice More "Plumming" Problems - Structured Settlements 4Real® Blog: Structured Settlements | Settlement Planning News and Commentary (typepad.com)  March 4, 2022

AnnuityExpertAdvice.com Clueless and Unreliable on Structured Settlement - Structured Settlements 4Real® Blog: Structured Settlements | Settlement Planning News and Commentary (typepad.com)  June 5, 2020

AnnuityExpertAdvice.Com Is No Annuity Expert | Calls Non Insurance Product Annuity - Structured Settlements 4Real® Blog: Structured Settlements | Settlement Planning News and Commentary (typepad.com) November 21, 2019

 

 

 

Structuredsettlements.com | Another Episode of What's Wrong Wit Dat?

by Structured Settlement Watchdog

“Do I have to pay taxes on my structured settlement?” asks the Orlando company behind Structuredsettlements.com 

The short answer is typically no.

StructuredSettlements.com's scantily furnished support immediately follows

"The tax status of your structured settlement payments is set when your settlement issuing company structures the settlement and rarely changes".

What's Wrong Wit Dat?

1. Settlements are a form of compromise
2. Settlements aren't issued, they're negotiated.
3. Structured Settlements arent' issued, they're negotiated
4. Life insurance companies issue annuities
5. Life Insurance companies issue structured settlement annuities
6. Structured settlement annuties are a qualified funding asset used to fund structured settlement obligations
7. Annuities are are a regulated insurance product
8. Settlements are not a regulated insurance product.
9. Life insurance companies do not issue settlements
10. Life insurance companies do not structure settlements
11. The taxation of structured settlement payments is based on the damages that the payments represent, as set forth the settlement agreement between the parties and the qualified assignment. 

Structured settlements.com then becomes further unmoored

"Money you receive from a personal injury or medical event isn’t considered income and so it isn’t taxed like income, according to Section 104(a)(2) of the Internal Revenue Service’s code."

What's Wrong Wit Dat?

1. The term "medical event" does not appear anywhere in IRC 104(a)(2). An accumulation of gas in the alimentary canal is a medical event. Wine and cheese will be served.
2. The Internal Revenue Service does not have a code. The Internal Revenue Code (IRC), formally the Internal Revenue Code of 1986, is enacted by Congress and amended from time to time. It is the  dometic part of federal statutory tax law in the United States, published as Title 26 of the Unied States Code. The Internal Reveneue Service is the federal agency that implements the Internal Revenue Code

Structuredsettlements.com is a shill for CBC Settlement Funding, a structured settlement factoring company in Conshocken, PA. It and its sister website Annuity.org continue to pump out inaccurate content, is and has been prone to unreliable in my opinion.  They mess up the basics and dont seem to care about accuracy depite posting ediatorial standards. For more accirate resources check with people who are Certified Structured Settlement Consultants, Master Structured Settlement Consultants or Registered Settlement Planners.

The Personal Injury Victim's Dilemma | Managing Expectations of Others

by John Darer CLU ChFC MSSC CeFT RSP CLTC

Personal injury victims may face the post settlement dilemma of "It's Your Settlement and Everyone Wants Your Money Now". Working with a settlement expert who is also a Certified Financial Transitionist can be helpful to help you manage expectations of family, friends and others and to help sort through, organize, prioritize and help make it easier to process your options. Settlement planning expert and Certified Financial Transitionist John Darer covers the issues in this introductory video.

What is a Certified Financial Transitionist (CeFT)?

CeFT holders are experienced financial professionals who understand how life transitions change financial situations.  It is a level up designation in that CeFT designees must also have earned and maintain at least one other highly respected professional designation such as the CFP, CIMA, ChFC, CDFA, CPWA, CPA/PFS, or CFA. 

CeFTs have the comprehensive knowledge and skills necessary to guide clients through a variety of transitions. When they meet with clients, CeFT holders show empathy and know how to listen carefully to their unique needs and emotions so they can make appropriate recommendations.

During their 12-month training program through the Financial Transitionist Institute,a division of the Sudden Money Institute, CeFTs become well-versed in the four stages of transition and use them and different tools to guide their clients through a successful transition during the uncertain and often chaotic times they’re facing.

With their support, you’ll be able to make smart financial decisions that lead to a happy future and help you avoid money problems down the road. Unlike a traditional financial advisor, a CeFT will understand the emotional side of your situation and keep it top of mind when they make recommendations and guide you through your transition. 

They can prevent you from making emotional, rather than logical financial choices that take a toll on your finances. Whether you’re anticipating a life transition or found yourself facing one unexpectedly, a CeFT can be a valuable resource and thinking partner. 

Sources:  Sudden Money Institute,  Wealthtender.com

Video copyright:  4structures.com LLC

 

Annuity.Org's Structured Settlement Misinformed Strike Again

by Structured Settlement Watchdog

A "Night Ranger" might say "Sister Christian your time has come, abject nonsense you're not the only one".

Here is what Rachel Christian of Annuity.org says are Key Takeaways about "When You Can Cash Out an Annuity?

1. "There aren't any surrender charges or early withdrawal tax penalties for selling structured settlement payments". 

Comment: When you're only getting mere pennies on the dollar from the structured settlement factoring company that Annuity.org's shilling for, who's counting? 

2. "Both withdrawing annuity funds and selling structured settlement payments result in paying taxes on the money received".

Comment: Weak effort (a/k/a Bollocks Bolognese) by Rachel Christian and Annuity.org. On June 10, 1999, the IRS issued guidance on the tax treatment to the payee in a structured settlement factoring transacton.  In Private Letter Ruling PLR-119273-97 the IRS concluded that the lump sum received from the sale of structured settlement payment rights retained the same tax treatment that it was accorded prior to the structured settlement factoring transaction.Download IRS PLR PLR-119273-97 on Tax Treatment of Structured Settlement Factoring Lump Sum to Payee.

The typical Written, Edited and Financially Reviewed Notation at Annuity.Org is cast into doubt yet again.   Here's what Annuity.org claims

• Written By Rachel Christian
• Edited By Kim Borwick
• Financially Reviewed by Rubina K Hossain CFP
• Updated: April 25, 2022

Apparently quality control did not verify the facts! So very sad that three people are unable to screw in the proverbial light bulb of accurate information.  Annuity.org shills for Conshohocken PA based CBC Settlement Funding, a leading patron of the content barfing of structured settlement misinformation. See Annuity.org Nonsense.

Annuty.org claimed two Cited Research articles and this is how Annuty.org puffs up their "editorial standards"

"Annuity.org writers adhere to strict sourcing guidelines and use only credible sources of information (Apparently an on-point IRS Private Letter Ruling is not deemed credible), including authoritative financial publications, academic organizations, peer-reviewed journals, highly regarded nonprofit organizations, government reports, court records and interviews with qualified experts"

"...Motoring
Why can't you get it right?
Cut out the frickin' blight!
No more blight tonight"

Parody of Sister Christian by Night Ranger (2011)

Part of my ongoing mission as Structured Settlement Watchdog is to see that consumers have the clearest path to accurate information about structured settlements. 

 

 

 

 

SF Weekly Publishes the Dumbest Piece About Structured Settlements Ever, for Profit

by Structured Settlement Watchdog

San Francisco's weekly rag, the SF Weekly has published one of the dumbest pieces about structured settlements ever.  "All You Need to Know About Structured Settlements and How to Sell Them" is accredited to an unidentified paid sponsor which peddles pennies on the dollar financial smack to consumers. SF Weekly claims to be "San Francisco’s smartest publication. That’s because we take journalism seriously".  My question is where does taking in money from paid sponsors, enabling them to unload more crap than on the streets of San Francisco  intersect with "serious journalism"?

Lie #1

"It is absolutely legal to sell a structured settlement for instant cash".

What SF Weekly published  on January 16, 2021 in exchange for money from a sponsor is a total lie because  If you sell your structured settlement you will not get instant cash. A small advance perhaps, but not instant cash.

Lie #2

"When somebody plays a part in another person’s injury or financial losses, they’re compelled by a judge or jury to pay a compensation to the wronged party. This compensation is known as a settlement"

What SF Weekly published on January 16, 2021 in exchange for money from a sponsor is wrong because neither a judge nor jury awards a settlement.  The "awarded a settlement" vortex is one of the "Ground Hog Day" of financial illiteracy spread by financial illiterates in (or hired by) the structured settlement secondary market.

Ignoring the legal concept of negligence, one of the examples used in the lie, and published on January 16, 2021 by SF Weekly in exchange for money from a sponsor is "A quack doctor paying a settlement to a patient for prescribing a wrong medication or administering a wrong treatment. 

A quack doctor is "an unqualified person who claims medical knowledge or other skills"  [Source: Collins English Dictionary].

In order to practice medicine in California, one must be licensed by the Medical Board of California, which states its mission "is to protect health care consumers through the proper licensing and regulation of physicians and surgeons and certain allied health care professionals and through the vigorous, objective enforcement of the Medical Practice Act, and to promote access to quality medical care through the Board's licensing and regulatory functions".   [Source: Medical Board of California}

Taking the example of the sponsor of the article that SF Weekly took money from, would a "quack doctor" qualify for medical malpractice insurance to have money to pay a settlement?   A big part of an application for medical malpractice coverage involves credentialing. Medical schools attended, Internships, Residency, Fellowship, Other Training, details of prior coverage,  practice information, hospital staff appointments, board certifications, list of states where licensed and license numbers. List all counties and states where you are currently practicing, and the corresponding percentages of patient hours expended in each [ Sourced from application from the largest medical malpractice insurer in the United States]

What is medical negligence?

“The elements of a cause of action for medical malpractice are: (1) a duty to use such skill, prudence, and diligence as other members of the profession commonly possess and exercise; (2) a breach of the duty; (3) a proximate causal connection between the negligent conduct and the injury; and (4) resulting loss or damage.” (Lattimore v. Dickey (2015) 239 Cal.App.4th 959, 968 [191 Cal.Rptr.3d766].)

Lie #3

In describing how settlements are paid. SF Weekly Publishes Lie #3 on January 16, 2021, in exchange for money from one of its sponsors , that a settlement is paid as a one-time payment, wherein the offender pays the wronged party compensation they're owed in one go. Alternatively it is described as a structured payment wherein an offender agrees to pay a regulat stream of payments.... The latter is also known as " structured settlements"

• An offender is someone who commits an illegal act.
• Criminal negligence is the reckless disregard for the safety or life of another human being. An act of negligence that is so serious it could constitute a criminal offense, e.g. the negligence regarding the care of a child is so severe it would make the accused criminally responsible.
• Then there is the case of Mens Rea. Did the doctor have it?  To illustrate, we'll  go old school on this one with a classic scene from "See No Evil Hear No Evil"
  

Generally structured settlements settlements are entered into by Defendants and Insurers (in some cases qualified settlement funds) as consideration for a release of liability from claimants or plaintiffs.

Lie #4 Published by SF Weekly January 16, 2021, in exchange for money from a sponsor

"You’re not breaking any law by selling your structured settlement. What you’re simply doing is borrowing from your future payments. It is still your money, only that you’re getting it before the due date".

A structured settlement transfer is a sale and irrevocable assignment of structured settlement payment rights for pennies on the dollar. You will ALWAYS lose money.

Lie #5 Published by SF Weekly January 16, 2021, in exchange for money from a sponsor

"This rate usually ranges from 9 to 20 percent, depending on the perceived risk associated with your payment" says the article. Factoring companies charge a discount rate on the sale of structured settlement payments. Sellers get a percentage of the present value. That is literally only pennies on the dollar. But the reality is that rates are available well below 9%. Don't be a sucker consumers!

 

 

 

The 2020 "Awarded a Structured Settlement" Blithering Peanut Pusher Awards (BPPA)

by Structured Settlement Watchdog

A structured settlement is negotiated not awarded.

"Pushing the peanut" that you can be "awarded a structured settlement", continues to be a sad fundamental flaw of sectors of the structured settlement secondary market. Since these folks are at odds with the fundamentals one naturally wonders what other aspects of their business they are getting wrong in public facing communications to consumers. Those that get it wrong unfortunately use this information to generate leads for their businesses, which involves soliciting consumers to sell their structured settlements for pennies on the dollar. In the interests of financial literacy, why not just get the correct information into the melons on your collective necks and disseminate correct information?  Practice makes perfect.

"Peanut pushers"

Secondary Market Purveyors of Structured Settlement Misinformation 

1. "If a lawsuit was settled for your benefit, then you may be awarded a structured settlement payout.  [ Google Page 1  12/28/2020]

Purveyor of Misinformation: Annuity Capital.  Now there's no sense from a company whose value proposition to consumers is making them "cents" (on the dollar! 

2."What Is the Process for Being Awarded a Structured Settlement?"   [ Google page 1 12/28/2020]

Purveyor of Misinformation: J.G. Wentworth. The market leader doesn't get it after doing this for nearly two decades?

3. "When a court decides someone is at fault, the surviving family members of a victim can be awarded a structured settlement"  [ Google Page 1 12/28/2020]

Purveyor of Misinformation: Structuredsettlements(dot)com . No surprise.  No sense. So if Larry ReBar hurts his back at work, his family gets an "atta boy" while Larry gets nothing?  Who proof reads this nonsense?

4.  "Anyone can be awarded a structured settlement in a lawsuit, though the term most often refers to those who have been awarded a settlement after a personal injury legal case.   [Google Page 1 12/28/2020]

Purveyor of Misinformation: Consumer Affairs. A double down on wrong, authored by Clark Kendall, a Personal Finance Expert

5. “A structured settlement is a regular stream of tax-free payments granted to the plaintiff in a civil lawsuit structured settlement is a type of annuity that pays out an award from a civil lawsuit” 

Purveyor of Misinformation: Annuity.org  Elaine Silvestrini, who cites 3 sources , none of which use the word "grant", because a structured settlement is neither bestowed on someone  or a charitable grant. It is the result of a negotiation and compromise and paid as consideration for a release of claims.  The sad thing is that the Silvestrini was financially reviewed by Somer G. Anderson, Ph.D., CPA, CGMA, CFE, who despite her impressive professional designations, none have anything to do with structured settlements.

6. "Question: Camila Was in An Automobile Accident. She was Awarded a Structured Settlement...”

Purveyor of Misinformation: Chegg Study Textbook Solutions  Business Questions and Answers (12/29/2020). There is a typical finance problems with 4 numerical answers. It's a trick question students. Perhaps the teacher knows it is. Perhaps they don't. Because you cannot be awarded a structured settlement, logically none of the 4 choices is right. Need the back up? Contact me. I'm not interested in discrediting the teacher. I'm interested in seeing that future business leaders and consumers are given accurate information.

7. “It took 5 years, but in 1992, Kelly was finally awarded a structured settlement...”  (12/29/2020 Google search result)

Purveyor of Misinformation: Strategic Capital.  Not likely Stratcap. In 1992, Kelly could not have been doing her best CeCe Peniston ("Finally it's happened to me right in front of my face,  My feelings can't describe it"), because it wasn't awarded to her. It was part of a negotiated compromise. A settlement, not an award!

 

 

 

A structured settlement is negotiated not awarded.

"Pushing the peanut" that you can be "awarded a structured settlement", continues to be a sad fundamental flaw of sectors of the structured settlement secondary market. Since these folks are at odds with the fundamentals one naturally wonders what other aspects of their business they are getting wrong in public facing communications to consumers. Those that get it wrong unfortunately use this information to generate leads for their businesses, which involves soliciting consumers to sell their structured settlements for pennies on the dollar. In the interests of financial literacy, why not just get the correct information into the melons on your collective necks and disseminate correct information?  Practice makes perfect.

"Peanut pushers"

Secondary Market Purveyors of Structured Settlement Misinformation 

1. "If a lawsuit was settled for your benefit, then you may be awarded a structured settlement payout.  [ Google Page 1  12/28/2020]

Purveyor of Misinformation: Annuity Capital.  Now there's no sense from a company whose value proposition to consumers is making them "cents" (on the dollar! 

2."What Is the Process for Being Awarded a Structured Settlement?"   [ Google page 1 12/28/2020]

Purveyor of Misinformation: J.G. Wentworth. The market leader doesn't get it after doing this for nearly two decades?

3. "When a court decides someone is at fault, the surviving family members of a victim can be awarded a structured settlement"  [ Google Page 1 12/28/2020]

Purveyor of Misinformation: Structuredsettlements(dot)com . No surprise.  No sense. So if Larry ReBar hurts his back at work, his family gets an "atta boy" while Larry gets nothing?  Who proof reads this nonsense?

4.  "Anyone can be awarded a structured settlement in a lawsuit, though the term most often refers to those who have been awarded a settlement after a personal injury legal case.   [Google Page 1 12/28/2020]

Purveyor of Misinformation: Consumer Affairs. A double down on wrong, authored by Clark Kendall, a Personal Finance Expert

5. “A structured settlement is a regular stream of tax-free payments granted to the plaintiff in a civil lawsuit structured settlement is a type of annuity that pays out an award from a civil lawsuit” 

Purveyor of Misinformation: Annuity.org  Elaine Silvestrini, who cites 3 sources , none of which use the word "grant", because a structured settlement is neither bestowed on someone  or a charitable grant. It is the result of a negotiation and compromise and paid as consideration for a release of claims.  The sad thing is that the Silvestrini was financially reviewed by Somer G. Anderson, Ph.D., CPA, CGMA, CFE, who despite her impressive professional designations, none have anything to do with structured settlements.

6. "Question: Camila Was in An Automobile Accident. She was Awarded a Structured Settlement...”

Purveyor of Misinformation: Chegg Study Textbook Solutions  Business Questions and Answers (12/29/2020). There is a typical finance problems with 4 numerical answers. It's a trick question students. Perhaps the teacher knows it is. Perhaps they don't. Because you cannot be awarded a structured settlement, logically none of the 4 choices is right. Need the back up? Contact me. I'm not interested in discrediting the teacher. I'm interested in seeing that future business leaders and consumers are given accurate information.

7. “It took 5 years, but in 1992, Kelly was finally awarded a structured settlement...”  (12/29/2020 Google search result)

Purveyor of Misinformation: Strategic Capital.  Not likely Stratcap. In 1992, Kelly could not have been doing her best CeCe Peniston ("Finally it's happened to me right in front of my face,  My feelings can't describe it"), because it wasn't awarded to her. It was part of a negotiated compromise. A settlement, not an award!

 

 

 

Annuity.Org | The "Teacher" That Is A Wolf In Sheep's Clothing

by Structured Settlement Watchdog

If you want to learn about structured settlements does it make sense to learn from the stooge of the "animal" that is trying to eat them, leaving very little flesh on the bone of stable secure income? 

Annuity.org is the sheep's clothing for wolf CBC Settlement Funding, and is known for posting some incredibly uninformed things about structured settlements through some incredibly poor research and with stunning breadth across the organization's writers

Annuity.org, a long time stooge of CBC Settlement Funding, and "super spreader" of inaccurate information about structured settlements, has a long list of writers who have a bad case of "don't-know-what-the-eff-they're-talking-about-itis"  when it comes to how structured settlements work.

Despite citing 7 Research Articles, somehow Kim Borwick, writer and editor " Annuity.Org" is the latest writer to fluff their lines in a July 29, 2020 posting whose purpose is expressly to generate leads for CBC Settlement Funding.

Here are six reasons why Annuity.Org is "Annuity.Wrong": 

1. "In general, the IRS taxes only structured settlement money that was negotiated as part of punitive damages or distress that was not caused by a physical illness or injury".

Why Annuity.Org is Annuity.Wrong

In the United States, Article I, Section 8 of the Constitution gives Congress the power to "lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States. This is also referred to as the "Taxing and Spending Clause. The IRS does not tax structured settlement money or tax anyone for that matter. The Internal Revenue Service (IRS) is a government agency that is a bureau of the Department of Treasury. The IRS is responsible for collecting taxes and administering the Internal Revenue Code, our main body of federal statutory tax law of the United States. In the United States children learn about the Constitution from grades 4-7.

2. "Liquefy your structured settlement"

Why Annuity.Org is Annuity.Wrong

Liquefy means turning something into a liquid. A structured settlement is not liquified in a structured settlement factoring transaction. The term liquidity means an asset that can readily be converted into cash, such as a savings accounts, stocks and so on. A structured settlement is established by a meeting of the minds between settling parties. The parties agree on a schedule of future periodic payments. The Defendant, and/or its insurer assignment the obligation to make those payments to a qualified assignment company which in turn buys a qualified funding asset (most of the time an annuity) to fund the future periodic payment obligation. The assignment company is the owner of the annuity and the annuitant only has right to receive payments.  It is the structured settlement payment rights, not the annuity that can be sold, or technically, transferred to a third-party buyer in a structured settlement factoring transaction. The terms of settlement that were agreed to when the structured settlement was established remain in place. 

3. "Consult your state attorney general’s office or consumer protection division to confirm that the factoring company you choose has no complaints on file"

To be fair, Annuity.Wrong is protecting its own client CBC Settlement Funding, which has some pretty stinky poop out there that one would never find by going to the Federal or State Attorney General

Like This  CBC Settlement Funding Persists A Year After Structured Settlement Factoring Petition on 19 Year Old Canceled Due to Mental Illness

4. "The court-approval process takes roughly 45 to 60 days, which is why you may want to select a purchasing company that offers cash advances, also referred to as pre-settlement funding" 

Why Annuity.org is Annuity.Wrong

Pre-settlement funding provides you with a cash advance on the future compensation that you expect to receive from a claim. If you need money before your claim settles to cover bills and living expenses, pre-settlement funding is one way to get you the cash you need as quickly as possible. A structured settlement factoring transaction is not a settlement, it is a factoring transaction. 

It's also not a good idea to get hooked on cash advances. Be mindful that for every $1 you get as an advance, it could cost you $2 or more in structured settlement payments, especially at the rip off out of touch rates that Annuity.org cites as a typical discount rate (see #6 below)

5. "If the court agrees that the sale is in your best interest, you will have to decide on the terms of the sale. You can sell some of your payments, a portion of each payment, or your entire structured settlement". 

Why Annuity.org is Annuity.Wrong

The terms of sale and transfer are agreed before the petition goes to the court seeking approval of a structured settlement transfer.

6. "With this formula, the company calculates the “discount rate.” The discount rate is the percentage that factoring companies charge to account for the inherent risk associated with money that they will receive in the future. The discount rate typically falls between 9 and 20 percent".

Why Annuity.org is Annuity.Wrong

The "typical discount rate of between 9% and 20%" would be rip off range in 2020.  It's a #totalbs narrative when CrowFly is advertising an average discount rate of under 7%. I've seen deals done in the 4s 5s and 6s, with others.  Kim Borwick  and Annuity.org are out of touch.

 

Structuredsettlements.com Unreliable and Illiterate on Tax Status of Structured Settlements

by Structured Settlement Watchdog

CBC Settlement Funding feasts off the structured settlement payment rights of gullible people who read the unreliable and inaccurate information published by their marketing partners Annuity.org and Structuredsettlements.com. Today's special from CBC's marketing poo poo heads is "Crap on Crostini" about the taxation of structured settlements.

Structuredsettlements.com "Crap on Crostini" about Taxation of Structured Settlements

Do I have to pay taxes on my structured settlement? 

Structuredsettlements.com answers:

"The short answer is typically no. The tax status of your structured settlement payments is set when your settlement issuing company structures the settlement and rarely changes. Money you receive from a personal injury or medical event isn’t considered income and so it isn’t taxed like income, according to Section 104(a)(2) of the Internal Revenue Service’s code."

11 Reasons Why StructuredSettlements.Com is A Load of BS

1. The Internal Revenue Service does not have a code, except perhaps a figurative "nudge nudge, wink wink" when its enforcement team is about to storm the offices of a factoring company that is not in compliance with a structured settlement protection act.
2. The Internal Revenue Code, formally the Internal Revenue Code of 1986, is the domestic portion of federal statutory tax law in the United States, published in various volumes of the United States Statutes at Large, and separately as Title 26 of the United States Code. It is organized topically, into subtitles and sections, covering income tax, payroll taxes, estate taxes, gift taxes, and excise taxes; as well as procedure and administration. Its implementing agency is the Internal Revenue Service  [ Source:  CCH Tax Law Editors ]
3. There is no such thing as a "settlement issuing company".
4. A structured settlement is a form of settling a claim or lawsuit.
5. A settlement is a compromise between adverse parties in the claim or in the lawsuit.
6. A structured settlement annuity is one of the permissible qualified funding assets as set forth in IRC 130(d).
7. A structured settlement annuity issuing company does not structure the settlement, the compromising parties do.
8. How structured settlement payments are taxed has to do with the nature of the damages the payments represent.
9. Structuredsettlements.com represents that the tax status rarely changes. What would be the rare instance where the structured settlement was tax free and then it changed? 
10. On August 21, 1996, President Clinton signed the Small Business Job Protection Act of 1996. Taxation of damages was affected by this bill. The Act changed the exclusion from gross income of damages received on account of personal injury or sickness to apply only to damages which are received on account of a physical injury or physical sickness.  If the claim resulting in damages or settlement payments has its origin in a physical injury or sickness, then all damages (other than punitive damages) that flow from that injury or sickness are treated as payments on account of that physical injury or sickness. If, however, the claim has its origin in emotional distress, even if subsequent physical injury or sickness is alleged, damages or any settlement payment made is taxable because it stems from a nonphysical injury. (Damages which reimburse the cost of medical treatment are not taxable).  
11. What is a medical event?   If you go into your doctor's office and submit a stool sample and a cup full of urine for testing, or go to the podiatrist to remove an ingrown toe nail is that a medical event that gives you the ability to structure?  Of course not.  None of them represent damages which are received on account of physical injury or physical sickness.

Click structured settlement tax benefits for more information

 

Genex Capital Bizarre Explanation of Why Discount Rates For Cases Are So High When Rates Are So Low

by Structured Settlement Watchdog

Genex Capital Basic Economics

"Sellers of structured settlements have been asking why are discount rates for their cases so high when the Federally set interest rate is so low.

The answer to this is basic economics:

1. The Fed rate is low because there is reduced market activity and the Fed is trying to stimulate such activity.

2. Demand for money is high but lending supply is low (this is what they mean when they say money is tight). 

3. While the Fed rate is low, try to get a mortgage or loan, or worse yet a credit card interest rate that is in the single digits". 

Source: Genex Capital website, retrieved 6/26/2019

Comments

The St Louis Fed chart here show not much tightening for commercial or industrial loans for large and middle market firms. Is Genex Capital one of those, or is Genex Capital just small potatoes?  JG Wentworth has a 4% cost of money. And RSL Funding claims that "you've likely been ripped off by JG Wentworth" in its latest marketing message, implying a low cost of money. What does that mean in the context of what Genex Capital has stated?   Why are deals getting done in the 5-6% range, when Genex Capital appears to be trying to justify rates much higher?

The data straight from the Fed seems to conflict with the Genex Capital explanation

Moving on to the Mortgage Rates Mosh Pit.  The statement "While the Fed rate is low, try to get a mortgage or loan, or worse yet a credit card interest rate that is in the single digits" is a

Double Digit Rates Are a "Ribbit" Off in 2019

figurative toad stool.  Peter Warden The Mortgage Reports editor does an excellent job of what's driving current mortgage rates. Doesn't jive with what Genex Capital has posted on its website.

The structured settlement factoring industry has a preponderance of "sucks" when it comes to dissemination of accurate information. In doing so, with a few exceptions,  the structured settlement secondary market does a real disservice to consumers and has done so for a very long time.