The Law Office of Michael Osborne Highlights the Benefits of Structured Settlements

Structured settlements are a great choice for victims of personal injuries. They offer numerous tax benefits as well as flexibility that provide victims continued security and peace of mind.

Structured settlements are often utilized in personal injury cases as a means of compensating the victim for his or her personal injuries. Unlike a lump sum payment, which entitles the victim to the entire sum of his or her settlement upfront, a structured settlement is an agreement that guarantees the defendant or the defendant’s insurance company will make periodic payments to the victim over a set period of time.

Many victims of a personal injury accident choose structured settlements because of the tax advantages they provide. In a structured settlement, the principal and any interest gained from it are tax-free. This is not the case with lump sum payments, as they only offer victims a tax-free principal. Any earnings or interest on a lump sum payment is fully taxable as income, and these tax liabilities can greatly reduce the victim’s cash payout.

Structured settlements also offer victims the benefit of flexibility. Victims have the opportunity to structure their settlement in the way that best addresses their financial needs and protects them from inflation. Structured settlements can be set up as simple yearly payments, periodic lump sum payments every few years, or even set up with an initial lump sum payment and monthly indexed payments.

Long-term money management issues are another reason why victims may choose a structured settlement over a lump sum payment. A structured settlement will ensure that money will be there when the victim needs it. Structured settlements can provide a steady source of income, and thus offer victims greater peace of mind. Structured settlements can be particularly beneficial for those who have sustained injuries that require long-term care, as they will provide funds for the victims’ ongoing needs. Receiving a lump sum up front may put victims at risk of spending their settlement too quickly, leaving nothing for a time when the money may be necessary to pay for further medical treatment or equipment.

Before accepting a settlement offer, victims should seek the advice of an experienced Chicago personal injury lawyer. A personal injury lawyer will ensure that victims are compensated fairly for their injuries and will fight on their behalf to secure the best possible settlement.

The Law Office of Michael Osborne helps accident, wrongful death, and personal injury victims. To contact a Chicago personal injury attorney or learn more, visit http://www.michaelosbornelaw.com or call (312) 315-1765.

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