Legal Question in Personal Injury in New York
Question Re:Personal Injury Lawsuit Settlement
My boyfriend (28 years old)is getting a settlement from a hotel in Mass. for personal injuries sustained during an attack on hotel grounds. He would like to know if the monies could be signed him over to another family member so they can set up a sort of trust fund on his behalf. The reason he wishes to do so is so that he does not spend the monies inappropiately.
There is a bit more detail to the story but this is the general gist of it.
Thanks
3 Answers from Attorneys
Re: Question Re:Personal Injury Lawsuit Settlement
I agree with what has been previously said about this settlement. Contact an "estate planning" attorney. This type of attorney has experience drafting trusts.
This is a very delicate sitation, and should be handled delicately. Consult attorneys until you find one you are comfortable with.
Personal Injury Lawsuit Settlement
I received your post on 5-29-2001.
Yes.
The draft will come from the attorney's account payable to your boyfriend. After that, it's his to do with as he wishes, including cashing and setting up a fund, or signing the back of the check over (which I do not advise).
The pain and sufffering proceeds are generally tax free also.
Good Luck.
Re: Question Re:Personal Injury Lawsuit Settlement
Your boyfriend has some valid concerns. I would recommend that he seek the advice of an attorney or financial advisor to set up an appropriate plan. For instance, if he hasn't recieved the money yet- he could direct that the hotel send the money directly to a financial company who would purchase an annuity with with. Then this money could either be accessed now or at a later time like 10 years and would yeild a greater amount. MAtter of fact I just set one up for a client who is aged 34 and we put in $16,000 from a settlement she recieved. When she is 50 and her child is ready for college the annuity with pay out a lump sum of $42,000.00 and it is completely tax free. IF she received the money and then gave it to a financial firm to invest it may be worth the same but everything over the original $16,000 would be subject to capital gains taxes.
Additionally, attorneys can always set up trusts that can hold money so that they can not waste it away. I would not recommend that the money be given to a family member to hold without an agreement of some sorts. He may regret this later when he can not get the money back.
In short, there are plently of smart things to with a personal injury settlement. But you must think it through.
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