Settlement Planning

Our Settlement Planning Services

At Milestone, we are adept at working with both plaintiff attorneys and their clients to ensure a seamless transition from litigation to life afterwards. Our team provides direction, education, clarity, and protection from the pitfalls that come with financial recoveries, safeguarding every plaintiff’s best interests long after the final judgment has been rendered.

Trust Planning

Establishing a trust is a solution that works well in a variety of settlement planning scenarios, yet our consultants know that putting money in a trust can be just one component of the solution. We can suggest a plan that involves establishing a trust while also making some funds available more immediately through other avenues. Our expertise in Special Needs Trusts and Domestic Asset Protection Trusts makes us uniquely qualified to handle a variety of trust scenarios.

Domestic Asset Protection Trusts (DAPT)

One’s assets may come at risk later in life, for a number of reasons. A Domestic Asset Protection Trust is an irrevocable trust that offers the opportunity for lifelong planning and protection of assets. And this doesn’t just apply to settlements — anyone can get a Domestic Asset Protection Trust to protect their assets at any time.

Special Needs Trusts

A Special Needs Trust (SNT) is a type of trust that is established to benefit an individual with a disability, specifically under the age of 65, who is considered disabled by government standards. A Special Needs Trust allows a person with an illness or disability to have income that is held in a trust for their benefit without having their assets considered disqualifying from certain government benefits, such as Supplemental Security Income (SSI), Medicaid, and other needs-based benefits. Protecting the disabled individual from disqualification from these government benefits is an important function, as the settlement proceeds are often not enough to provide necessary ongoing medical care related to the disabled person’s injury.

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Medicare Set Asides

When a Medicare beneficiary receives a settlement from a personal injury lawsuit, a Medicare set aside account may be required. A Medicare set aside is established in order to protect the claimant’s future Medicare rights and to ensure that the government does not discontinue their health benefits due to improper consideration of the settlement money. Milestone’s team of settlement consultants will provide plaintiffs with all options and work with the plaintiff, their family, and their attorney to choose the best course of action to ensure future compliance with government regulations.

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Qualified Settlement Funds

A qualified settlement fund (QSF) is a trust that holds settlement funds after the defendant in a lawsuit settles the case and before the plaintiff receives their money. A qualified settlement fund is a powerful tool in settlement planning, as it extends the amount of time a plaintiff can take to plan out what he or she would like to do with their settlement. This tool also enables trial lawyers to contemplate what they would like to do with their attorney fee. By parking settlement money in a qualified settlement fund, a plaintiff can look into different financial planning strategies, and an attorney can look into setting up an attorney fee deferral.

The Milestone team also serves as a professional qualified settlement fund administrator, managing all necessary details of a settlement and the arrangement to allocate the funds to all appropriate parties. This solution is often appropriate and desirable for class action or mass tort lawsuits where there is a gross settlement comprised of multiple claimants.

The complex post-settlement financial environment is made more complicated by ever-evolving compliance requirements, disclosure guidelines, timelines, and ethics rules. Meticulous due diligence is required for the management of every critical detail in this process. From the negotiation of the settlement to the recovery from defendant(s), to the ultimate distribution to the claimants, our qualified settlement fund consultants are fluent in the nuances and complexities of mass tort and class action lawsuits. This extensive experience provides optimal results for our clients.

Qualified Settlement Funds

Government Benefits Planning

Consideration of a plaintiff’s current and future eligibility of government benefits, such as Medicaid and Supplemental Security Income, must be an integral part of the settlement planning process. The government benefits an individual receives must first be acknowledged, and their guidelines must be adhered to, in order for any settlement plan to be successfully implemented. Our team members routinely perform this due diligence in order to assess the needs of each client. Only then do we move to formulate an appropriate settlement planning strategy that will allow a plaintiff to keep his or her benefits while being able to receive their personal injury settlement.

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Structured Settlements

Available specifically for personal injury victims, wrongful death cases, and Workers’ Compensation claims, a structured settlement is an innovative settlement planning solution that allows an injured party to receive their settlement over a designated time frame. With a structured settlement, the injured party has the option to receive all or a portion of the compensation from his or her settlement in a series of guaranteed tax-free payments custom designed to meet their future needs. The plaintiff has the flexibility to receive any combination of a lump sum for immediate needs with designated periodic payments for long-term necessities, and he or she is able to determine the frequency and amount of these continued payments.

A long-term structured settlement has several advantages: providing security, guaranteed long-term income, and precious tax advantages. The federal tax code provides that 100% of structured settlement payments are exempt from federal taxes.

Investment-backed Structured Settlements

Traditional settlement plans have routinely relied on fixed, low-yielding instruments, whereas Milestone’s investment-backed structures are professionally managed with diversified portfolios. Clients have the ability to earn on their settlement dollars, tax-free. Based on typical market performance, these earnings could be between 7-9%.

These plans incorporate a combination of:

  • Fixed Income
  • US Treasuries
  • Investment Grade Corporate Bonds
  • Dividend Stocks
  • Private Equity
  • S&P 500
  • Russell 2000 Index
  • Fixed-Index, Traditional, or Secondary Market Annuities

Milestone’s investment-backed structures provide financial security and long-term income in predetermined increments. These payments are 100% exempt from federal and state income tax, and so is the growth on the account.

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Mediation & General Consulting

The Milestone team’s collective experience, education, and specialties span the many services that comprise the settlement planning industry. Known for proficiency and success, our settlement planning consultants are frequently asked to provide insight and counsel for all facets of settlement planning.

Often, we are called upon to be present in mediation. Involving a settlement planner in mediation gives the plaintiff a resource who can answer his or her financial questions, can be an advocate on behalf of the plaintiff, and can help interpret settlement offers that are being made to the injured party. A settlement expert can also share knowledge about using and preserving the settlement monies properly once they are received, whether that’s through a trust, a structured settlement, or another wealth management solution. Having a settlement planner present during mediation also reflects well on the attorney, showing that they are concerned about the well-being of their client and will take extra measures to make sure the settlement negotiations go in the plaintiff’s favor.

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Attorney Fee Deferral

Milestone recognizes that the attorneys we work with want innovative financial solutions with an eye on long-term wealth accumulation, too. Contingency fee attorneys may elect to plan for their personal and professional futures by deferring their fees. There is no minimum or maximum to what you can defer in a year, and we will work with you to create a plan that best fits your needs.

Potential tax benefits for the trial lawyer are achieved by creating a pre-tax investment, in addition to what is allowable, in qualified and non-qualified plans. It is vital that structured fees are part of the overall plan and thoroughly accounted for in subsequent documentation. Our expertise in both the legal and tax arenas gives us the perspective required to structure attorney fees that are compliant with case law and tax court rulings.

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Non-Qualified Assignments

In cases that do not involve personal injury, such as matrimonial litigation, employee litigation, or selling a business or real estate, a non-qualified assignment (NQA) might be the best settlement planning solution. A non-qualified assignment is an assignment of an obligation to pay money in the future. It gives a plaintiff the benefits of financial planning because he or she can spread their assets over a long period of time, thus spreading the tax obligation, instead of receiving them in one lump sum (which would be taxable). Additionally, a non-qualified assignment is useful for defendants because they can use this tool to settle non-physical injury claims and lawsuits and then rid themselves of the payment obligations.

Essentially, a non-qualified assignment is similar to a qualified settlement fund in personal injury cases, but it is used in non-personal injury cases. Similar to a qualified settlement fund, a non-qualified assignment can be used for contingency fee attorneys who are interested in deferring their attorney fees.

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