The year is wrapping up fast. Now is a great time for trial lawyers to consider year-end wealth management opportunities.
One planning option in particular is an excellent tool many lawyers use to either accelerate or defer the receipt of settlement monies. A qualified settlement fund (QSF) is a tax-qualified trust or account that holds settlement proceeds from litigation. It allows for more simplified and organized settlement administration. Both plaintiffs and their attorneys can reap the benefits of a QSF, and they work for all case types including tort, breach of contract, and others.
For one, this planning option gives everyone time to plan. A lawyer may want his or her fees right away, but the client needs to set up a trust. On the other hand, a client may want the funds right away and the lawyer could wait. These circumstances and others can be remedied by a QSF, which separates the business interest between the lawyer and client.
QSFs also allow for year-end tax planning for both the plaintiff and attorney. The taxable income can be spread over many years, and provide the potential for tax deferred growth.
Furthermore, by having a QSF established for year-end inventory of cases that may resolve, plaintiffs and their attorneys can serve a general release on the defendant as soon as the case settles, regardless of liens, hold backs, and other issues. All settlement issues that arise can be dealt with once the funds are received by the QSF administrator.
At Milestone Consulting, our experts find the best method to reach clients’ goals and meet government compliance. Planning-focused rather than product-oriented, we walk a client through the process to help them make the most informed decisions possible. Together, we develop the best course of action and guide our clients specific to their challenges. Contact Milestone today to learn more about QSFs and other planning options.
ABOUT JOHN BAIR
John Bair has guided thousands of plaintiffs through the settlement process as co-founder of Milestone Consulting, LLC, a broad-based settlement planning and management firm. Milestone’s approach is comprehensive and future-focused. John’s team has guided thousands of clients by taking the time to understand the complexities of each case. They assess the best outcome and find the path that enables each client to manage their many needs. Read more about Milestone Consulting at http://milestoneseventh.com/.
A West Point graduate where he served as captain and military aviator, John Bair continues his commitment to our country through his efforts within the settlement planning industry. He has represented families of victims lost in the Flight 3407 crash, offered pro bono services to the families of 9/11 victims and drafted the first consumer protection bill for plaintiffs (H.R. 3699).