The advantages one can get from having a structured settlement annuity are quite a few. The financial security of your dependents and you are well taken care of for long periods by the structured settlement payments; further, the interest earned on the payments as well as the payments themselves are nontaxable.  In case you need the money for any emergent situations or you find that you can invest this money in a better way you are entitled to do it as per law.

You can sell your structured settlement payments legally in US as per the federal law HR 2884, and this sale can be made without your paying any tax. About 67% of the states in the United States of America also allow the sale of structured settlement payment in addition to the federal laws. In both cases, however, the transaction must be approved in court in order to stay tax free.

Selling Your Structured Settlement

It is not difficult to get approval of the court for selling part or full quantum of your structured settlement payments provided you are able to prove your genuine requirement for money. Your proof will be examined by the judge to find out whether this transaction is in the interest of you and your family.

As long as you are an adult of sound mind, and you can proved that you and your dependents will benefit from the transaction, the judge has very little reason to deny your case. If you appear in the court on the hearing day your chances of getting court approval will be high. Court approval is not mandatory for selling your structured settlement payments; however the amount and interest will be taxed.

In all probability, the purchasing company with whom you have been discussing might be willing to purchase your structured settlement payments. To facilitate finalization of the sale they will handle necessary legal formalities. They refrain from charging any fees for this effort they have taken; however, you are liable to pay tax on the money received without court approval.

In order to select the right purchasing company, you should call for quotations from various purchasing companies. Getting quotations from a number of companies is advantageous to you because it will give you a chance to select the best among them. In case you find a suitable purchasing company out of the various quotes received, you should send to the purchasing company copies of the structured settlement policy. You will receive from the purchasing company a disclosure document which you are expected to sign. This document contains the clauses and conditions of the transaction. You must scrutinize the document thoroughly, sign it and return to the purchasing company.

In order to proceed further it is essential that the court approval is got and this is the next step in this process. The state of residence of the seller and buyer decides on the duration for completion of this process and normally it may take up to 90 days. In majority of the cases the sellers get their money within 10 days after court approval.

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