Attorney Fee Deferral

As a trial lawyer, you can strategically plan for your contingency fees around taxes, life’s milestones, and retirement goals. Through fee deferral, you can receive fees as payments over time in a tailored schedule. Also called attorney fee structure, fee deferral is a smart investment option to manage wealth and plan cash flow.

Your fee income can be spread, grown, and secured. We’ll work with you and an approved investment advisor to personalize an investment-backed periodic payment schedule that fits your needs. You’ll only pay income tax on the payments you receive in a year, while the rest grows in your portfolio, tax-deferred.

When you structure fees:

You’ll only pay taxes on the payments you receive within the year. Meanwhile, the rest of your fee will grow, tax-deferred, in an investment portfolio.
Your investment-backed deferral plan will address both your short- and long-term financial goals.
Your fee deferral plan will work in lockstep with your existing investment portfolio.
There are no limits to how much or how little you defer.

Let's talk about fee deferral

This field is for validation purposes and should be left unchanged.

Take your knowledge to the next level with Milestone’s

On-demand feeMaster class

feeMaster Class Episode 1 The Basics

Module #1: The Basics

Register and watch on demand >>

feeMaster class episode 2 tax law

Module #2: Tax Law

Coming Soon

feeMaster class episode 3 investing and future planning

Module #3: Investing & Future Planning

Coming Soon

Attorney fee deferral process

1

No constructive receipt

After settlement, your fee can go directly to an assignment company from the defendant/insurer, or it can flow from a qualified settlement fund (QSF) to the assignment company.
2

Create your plan

During this time, you’ll create your periodic payment schedule with Milestone, customizing when you’ll receive your payments and how much of your fee you’ll receive in a given year.
3

Fund your account

Once you've finalized your payment schedule, fees move from the assignment company and into the investment account with your chosen advisor. From there, Milestone and your advisor will work with you on a custom asset allocation based on your periodic payment schedule and risk profile.
4

Receive your payments

Your payments will arrive according to your predetermined schedule. There are no limits to how much or how little you can contribute to a deferral plan. You can also add to your deferral schedule with future fees.
5

Add more fees later

You have the ability to add fees to your existing schedule in the future, or you can create other deferral arrangements with new fees.

Frequently asked questions

How will fee deferral affect my taxes?

Structuring an attorney fee breaks up a large lump sum into a schedule of payments over time. Attorneys who structure their fees only have to pay taxes on the payments they receive in a given year.

How do I get started deferring my fees?

To defer a fee, you must not have constructive receipt of the money. As part of the settlement with the defendants and/or their insurers, your contingency fee must be a term of settlement that allows you to create a periodic payment obligation and defer some or all of your fee. The defendants/insurers would issue your fee payable to the selected assignment company. If a 468b qualified settlement fund (QSF) is established, your contingency fee must be a term of settlement that allows your fees to be payable into the QSF, which would then issue your deferred fee to the selected assignment company.

What type of fees can I defer?

Attorneys can defer any contingency fee from a physical or non-physical injury tort settlement.

If I worked on the case with another attorney, am I still eligible to defer my fee?

You can structure your fees even if you worked on a case with another attorney. Each attorney can decide whether to receive their portion of the fee in a lump sum or to defer into a unique payment schedule.