by Structured Settlement Watchdog
The triple bone head award structured settlement reporting award goes to Annuity.org yet again for a recently updated piece called ""Tax Implications of Selling Structured Settlement Payments.
"Annuity.org partners with outside experts to ensure we are providing accurate financial content. These reviewers are industry leaders and professional writers who regularly contribute to reputable publications such as the Wall Street Journal and The New York Times. Our expert reviewers review our articles and recommend changes to ensure we are upholding our high standards for accuracy and professionalism. Our expert reviewers hold advanced degrees and certifications and have years of experience with personal finances, retirement planning and investments".
The following is an excerpt from the Bonehead article stated by Annuity.org as authored by Elaine Silvestrini, edited by Kim Borwick and represented as financially reviewed by Marguerite M. Cheng CFP that lists 12 references. However, Annuity.org is bonehead inaccurate. given that the misrepresentations in the highlighted text demonstrate that none of the three amigas actually read the text of the relevant code sections they cited.
"Workers Compensation Settlements
Insurance companies can also issue annuity contracts to fund settlement payments in worker's compensation cases that involve physical injuries or illnesses suffered in the workplace. Section 104 (a)(2) of the Internal Revenue Code mandates that damages from on-the-job physical injuries or illnesses cannot be considered income, so they are not subject to taxation. Additionally, settlement recipients can sell their future payments with the tax-free advantages in place, as allowed by Section 130 of the IRC."
FACT: IRC 104(a)(1) gross income does not include "amounts received under workmen’s compensation acts as compensation for personal injuries or sickness
FACT: IRC 104(a)(2) gross income does not include the amount of any damages (other than punitive damages) received (whether by suit or agreement and whether as lump sums or as periodic payments) on account of personal physical injuries or physical sickness
FACT: IRC 130 has to do with qualified assignments and has nothing to do permitting settlement recipients to sell their future payments with tax-free advantages
FACT: IRC 5891 (c)(3)(A) defines " Structured Settlement Factoring Transaction" as " structured settlement payment rights (including portions of structured settlement payments) made for consideration by means of sale, assignment, pledge, or other form of encumbrance or alienation for consideration".
Why Does Annuity.org Keep Publishing Bonehead Mistakes?
It would be one thing to learn from their mistakes, but as I have documented here and have in ongoing commentary for more than 5 years, Annuity.org continues to demonstrate that it is unreliable as source of information about structured settlements.
FACT: Annuity.org exists in part to generate leads for a company ( CBC Settlement Funding, and at times others) that buys such payment rights for pennies on the dollar.