by John Darer CLU ChFC CSSC
This morning I, and other's subscribing to attorney John J. Campbell's Medicare Set Aside Bulletin, received issue number 47 dated August 7, 2008. The excerpt leads to the full story, which has the same issue number dated the same date but in 2006.
Among other things Campbell, a respected elder law attorney, but NOT a tax attorney, makes the perfunctory "one or more " argument to justify Congressional intent and the use of an IRC 468B Qualified Settlement Fund in case involving single claims.
In my June 9, 2008 post IRC 468B Qualified Settlement Funds Revisited…It's Not Ripe Until It's 4 Years Old I addressed this issue.
Key points, AGAIN!
- Unlike 6 or 7 years ago, It can easily be argued today a number of settlement professionals who recommend this device are interested in grabbing all of the commission on the placement of structured settlement annuities. Only one qualified assignee states that it will accept qualified assignment from a single claimant qualified settlement fund. So as things sit today, if you want a structured settlement out of such single claimant qualified settlement funds, your client will not get the full market opportunities that the proponents advertise. This fact may or may not be made transparent by the proponent.
- Failure to protect the opportunities for structured settlement diversification could later come back to haunt the plaintiff attorney with a legal malpractice claim. The attorney may not be insulated for his or her ignorance.
- Any effort to mass produce single claimant qualified settlement funds for purpose of greater commissions that can be used to fund greater state or national affinity contributions, while having prior knowledge of the above and #4 and #5, is a recipe for disaster.
- This author opines that there is not enough errors and omissions insurance to cover the collective advice on single claimant qualified settlement funds currently being given in this area by settlement professionals or rampant use by the "QSF jockeys" in the industry.
- Despite the promises by proponents of a ruling from the United States Treasury department on the viability of such transactions, there has been none. It appears that proponents are trying to stir up confidence by publishing articles, which ignore points 1 and 2 above. Then, of course legal articles and opinions are not binding on the Internal Revenue Service as any disclaimer will tell you.
That being said a IRC 468B Qualified Settlement Fund is a valuable tool on the appropriate case. There are innovative ways such cases are being currently used in the mass tort arena.
For more, please click below
What is a Qualified Settlement Fund and When Is It Used?
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