NU Online News Service, Dec. 21, 2:55 p.m. – The National Structured Settlements Trade Association, Washington, says a new bill will discourage recipients of annuity-based settlements, or “structured settlements,” from exchanging the annuity income for lump-sum payments.
H.R. 2884, a bill that creates tax breaks for victims of the Sept. 11 attacks, also includes a section that requires recipients to get court approval before selling settlement income rights to outside companies.
The section lets the government impose an excise tax on any company that tries to purchase income rights without getting court approval, the settlements association says.
The House and Senate approved the bill Thursday. President Bush is expected to sign the bill in the next few days.
The structured settlement section affects consumers who receive large out-of-court settlements as a result of acts of negligence or intentional wrongdoing.