Structured Settlement Association: President Bush Signs Landmark Protection For Americans With Disabilities Who Receive Structured Settlement Payments
WASHINGTON, Jan. 23 /PRNewswire/ -- On January 23, 2002, President Bush signed into law HR 2884, the federal tax relief package for victims of the September 11 tragedies. A key provision of that bill is a ``landmark protection for Americans with disabilities who receive structured settlement payments,'' according to Andrew J. Larsen, president of The National Structured Settlements Trade Association (http://www.NSSTA.com ) and executive vice president of GE Financial.

This new federal law protects all recipients of structured settlement payments and is drawn from legislation championed by Reps. E. Clay Shaw, Jr. (R-FL) and Pete Stark (D-CA) in the House and by Senate Finance Committee Chairman Max Baucus (D-MT), the original author of the structured settlement tax rules, and ranking Finance Committee Republican Sen. Charles Grassley (R-IA) in the Senate.

``This new law reinforces the financial security that is at the heart of structured settlements and further enhances the value they provide to accident victims and their families,'' said Larsen. ``It's a model piece of consumer protection legislation, giving new flexibility to injury victims who encounter unanticipated financial needs.''

``We are deeply appreciative of the longstanding leadership and tenacious and bipartisan efforts of Reps. Shaw and Stark and Sens. Baucus and Grassley to enact these critical protections for people with disabilities.''

``We also salute House Ways and Means Chairman Bill Thomas (R-CA) and ranking Ways and Means committee Democrat Rep. Charles Rangel (D-NY) for working with Chairman Baucus and Sen. Grassley to include these protections in the final victims' tax relief legislation.''

Under the new legislation, court oversight and approval will now be required for injury victims who chose to sell payments from a structured settlement to a third-party company.

Recognized by Congress since 1982, structured settlements provide long- term financial security to injury victims and their families through a stream of payments tailored to their needs. The new federal protection addresses concerns that have arisen over a practice known as ``factoring'', in which factoring companies purchase future structured settlement payments in exchange for a cash sum.

``Virtually every major organization that advocates on behalf of Americans with disabilities urged Congress to pass this measure,'' said Larsen, who cited the National Organization on Disability, the American Association of People with Disabilities, United Cerebral Palsy, National Spinal Cord Injury Association, the National Foundation of the Blind, The Arc of the United States, NISH, and the Honorable Justin Dart.

``Their unwavering and vocal support for this new protection for people with disabilities and for the families of accident victims sent a decisive message to Congress. It was a dramatic expression of the public policy virtues inherent in this legislation.'' (A copy of a June 2001 letter from these organizations to Congress on this issue is available at: http://www.NSSTA.com .)

The new legislation provides for a substantial federal excise tax on any company trying to purchase future payments from injury victims -- unless a state court first approves the transaction as being in the best interests of the victim. The court must take into account the welfare of the victim's dependents and find that the transaction does not contravene applicable statutes and court orders.

Since 1997, 30 states have enacted consumer protections on the factoring of structured settlement payments. Support has also come from a broad cross- section within the legal and insurance communities, including such prominent plaintiff attorneys as Joseph Jamail, Philip Corboy, William Garmer, and Robert Clifford, as well as the American Insurance Association, the American College of Life Insurers, and the Alliance of American Insurers.

The National Structured Settlements Trade Association is an organization of more than 500 members who are involved with structured settlements of injury cases. For more information, go to the association`s website: http://www.NSSTA.com .

SOURCE: National Structured Settlements Trade Association


Email this story - Most