by John Darer® CLU ChFC MSSC RSP CLTC
A Davidson County Tennessee Circuit Court jury awarded Fox Sports Los Angeles based broadcaster Erin Andrews $55 million in damages on March 7, 2015. The damages stem from Erin Andrews’s successful lawsuit against West End Hotel Partners and Windsor Capital, operators of the Nashville Marriott at Vanderbilt University.
Michael David Barrett, who in 2009 pleaded guilty to interstate stalking of Andrews and sentenced to 27 months in prison, was also a co-defendant in the case. Barrett had stalked and videotaped Andrews on several occasions and in different cities. He duped a Nashville Marriott employee into confirming Andrews’s reservation and his request to book a room next to her was granted. Barrett then used a peephole to surreptitiously videotape her while she changed. He later placed his videos online and millions watched.
How Much of the $55 million will Erin Andrews see?
How much Erin Andrews will be able to collect is up for grabs. She probably won't get much out of Barrett who was assigned half of the liability. One thing that's almost certain is that what Erin Andrews does receive through a final judgment or settlement will be taxable income in a high tax bracket.
Non Qualified Structured Settlement is a Time Tested Tax Deferral Solution
Erin Andrews could benefit from a non-qualified structured settlement, allowing her to spread or defer income in a way tailored to her needs. Given her substantial earnings with Fox, the tax deferral opportunities through qualified plans are limited by lower contribution caps, making a customized solution more advantageous.
Non-qualified assignments have been effectively used for decades to help resolve lawsuits involving taxable damages. A non-qualified structured settlement can be funded in various ways, depending on whether or not the defendants are insured. For instance, a flowchart can illustrate how a non-qualified structured settlement works when funded with an annuity, such as those issued by Liberty Life Assurance Company of Boston, a Liberty Mutual subsidiary. These settlements can also be funded through U.S. Treasury obligations and reinsurance. Additionally, there are some unique non-qualified structured settlement options. A 2008 IRS Private Letter Ruling (PLR 200836019) addressed the use of non-qualified structured settlements in employment contexts involving taxable damages, ruling favorably on such transactions.
How Does a Non Qualified Structured Settlement Work?
What are Non Qualified Structured Settlements and Non Qualified Assignments for Tax Deferral
Do you need to have a Big Case to benefit from a Non-Qualified Structured Settlement?
You don't need a large case like Erin Andrews' to benefit from a non-qualified structured settlement. Even a modest recovery can put you in a higher tax bracket.
Who Do I Contact About Non Qualified Structured Settlements?
For more information about non qualified structured settlements, please contact John Darer® CLU ChFC MSSC CeFT RSP CLTC at 888-325-8640