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A structured settlement’s most important advantage is security. It provides long term payments that are guaranteed by a life insurance company (such as American General Life Companies insurers).
A second advantage is its income tax-free position. All payments made via a structured settlement are nontaxable by federal tax guidelines assuming the claim meets the requirements of IRC Section 104(a)(2). If your claim qualifies under the tax law, 100% of every payment is free of federal income tax.
Lastly, a structured settlement allows the injured party to tailor payments over his or her life. There is no need to meet periodically with an investment or tax advisor. Payments are decided during the initial settlement and then are directed to the injured victim. It gives peace of mind, security, and confidence over the long term.
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