ART OF SETTLEMENT

January 10, 2022

When any physical injury victim recovers money either by settlement or by verdict, the question of the tax treatment of said recovery arises. As long as it is compensation for personal physical injuries it is tax-free under Section 104(a)(2) of the Internal Revenue Code.1 Section 104(a)(2) of the Internal Revenue Code states that “gross income does not include . . . the amount of any damages received (whether by suit or agreement and whether as lump sums or as periodic payments) on account of personal injuries or sickness.”2 Section 104(a)(2) gives the personal injury victim two different financial options for their recovery, lump sum or periodic payments.3 For more information, read this excerpt from my book ‘The Art of Settlement‘.

November 11, 2021

In the confusing landscape of public benefits and planning issues that arise today for trial lawyers when settling catastrophic injury cases, finding your way can be a daunting task. Many
questions come up such as should the client seek Social Security Disability (SSDI) benefits and become Medicare eligible? Doesn’t that trigger the need for a Medicare Set-Aside? What if the
client is receiving needs-based benefits such as Medicaid and/or Supplemental Security Income (SSI)? Is coverage under the Affordable Care Act (ACA) a better or even an available option?
How should the recovery be managed from a financial perspective? Is a trust appropriate? Should a structured settlement be considered?

Learn the answers to all of these complex questions by downloading this case study written by Synergy’s CEO, Jason D. Lazarus, J.D., LL.M., MSCC, CSSC:

 

January 12, 2021

The Medicare program—and the related Social Security Disability Income/Retirement benefit (SSDI)—is one of the primary benefit programs available to those who are injured and disabled. Understanding the basics of this program is imperative to protecting the client’s eligibility for their benefits.

Medicare and SSDI benefits are an entitlement and are not income or asset sensitive. Clients who meet Social Security’s definition of disability and have paid enough quarters into the system can receive disability benefits regardless of their financial situation. For more information, read this excerpt from Synergy’s CEO, Jason D. Lazarus’ book ‘The Art of Settlement’:

November 17, 2020

What do you do when you settle a case like this where your client is on public assistance, there are allocation issues, settlement planning issues must be addressed, and there are liens to negotiate? Where can you “park” the money while you set up any necessary public benefit preservation trusts, determine allocation of the proceeds, figure out a financial plan, and negotiate the liens? How can you get the money from the defendant immediately without ruining the client’s available settlement planning options?

For more information, read this excerpt from Synergy’s CEO, Jason D. Lazarus‘ book ‘The Art of Settlement.’

November 10, 2020

Mrs. Smith was moved to the ICU and no neurologic monitoring was performed that evening after being moved from the surgical suite. The next morning, Mrs. Smith was found to be quadriparetic. A suit was brought against multiple defendants with a significant seven-figure recovery secured. Mrs. Smith and her family had Medicaid coverage and SSI. She had also applied for Social Security Disability Income (SSDI). At the time of settlement, there was no Medicare eligibility, since she had not been approved for SSDI and she wasn’t sixty-five.

In the confusing landscape of public benefits and planning issues that arise today for trial lawyers when settling catastrophic injury cases, finding your way can be a daunting task. In the paragraphs that follow, I’ll use Mrs. Smith’s real-world example to identify six key considerations to look out for when you’re settling a case for a catastrophically injured client.

For more information, read this excerpt from Synergy’s CEO, Jason D. Lazarus‘ book ‘The Art of Settlement.’

November 4, 2020

John Doe was a laborer since age eighteen, but when he was thirty, he was severely injured and became paralyzed. John didn’t have health insurance at the time of his accident, and the hospital applied for Medicaid on his behalf after getting injured. He qualified for Medicaid, since he had no real assets and no longer had an income. His family applied for Social Security Disability since he had worked enough quarters to be insured. John’s personal injury lawyer has settled the case for $1,000,000, which will help him pay for everything he now needs, but it is far less than what is needed to pay for all his future medical care. The question now is what to do with the settlement?

For more information, read this excerpt from Synergy’s CEO, Jason D. Lazarus‘ book ‘The Art of Settlement’:

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