STRUCTURED SETTLEMENT CASH NOW GUIDE

Do you have a structured settlement? The structured settlement cash now guide can help you get a cash payment quote. Find out how to - Cash In a Structured Settlement.

> Free Consultation - Get structured settlement help regarding selling your annuity future payments. HAVE A Structured Settlement Purchaser Factoring Representative Contact YOU, this site will forward your questions & requests to an established finance representative/company.

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Use Form 8876 to report and pay the 40% excise tax imposed under section 5891 on the factoring discount of a structured settlement factoring transaction. File a separate Form 8876 for each date on which you received structured settlement payment rights in one or more structured settlement factoring transactions.

Generally, you must file Form 8876 if you acquire directly or indirectly structured settlement payment rights in a structured settlement factoring transaction entered into after February 21, 2002.

READ - However, do not file Form 8876 if the transfer of structured settlement payment rights was approved in advance in a qualified order, as no excise tax is due.

File Form 8876 by the 90th day following the receipt of structured settlement payment rights in a structured settlement factoring transaction.

If you need more time, file Form 7004, Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns, by the due date of Form 8876. Form 7004 does not extend the time for payment of tax.  Interest. Interest is charged on taxes not paid by the due date at a rate determined under section 6621. Late filing of return. Generally, a penalty of 5% a month or part of a month, up to a maximum of 25%, is imposed on the net amount due if Form 8876 is not filed when due. This penalty will not be imposed if you have reasonable cause for not filing on time. If you do, attach an explanation.

Read more at IRS
http://www.irs.gov/pub/irs-pdf/f8876.pdf

 

Do you have a structured settlement? The structured settlement cash now guide can help you get a cash payment quote. Find out how to - Cash In a Structured Settlement.

> Free Consultation - Get structured settlement help regarding selling your annuity future payments. HAVE A Structured Settlement Purchaser Factoring Representative Contact YOU, this site will forward your questions & requests to an established finance representative/company.

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Woman brain-damaged by listeriosis questions Maple Leaf offer. A B.C. woman who suffered brain damage after eating a bacteria-loaded sandwich says the $27-million settlement proposed by Maple Leaf Foods Inc. may not be enough to compensate all the victims of last year’s listeriosis outbreak.

Arlene Laughren of Fort St. John, B.C., has filed an objection to the proposed class-action settlement, arguing the Toronto company hasn’t provided any details to prove the pool of money will cover everyone injured by the contaminated food.

“We have no idea how many people are really affected, and how many are seriously affected,” said Laughren, 51, who spent seven months in hospital recovering from brain surgery to remove an abscess caused by the bacteria.

Read more at
http://www.montrealgazette.com/Health/story.html?id=1365989

Do you have a structured settlement? The structured settlement cash now guide can help you get a cash payment quote. Find out how to - Cash In a Structured Settlement.

> Free Consultation - Get structured settlement help regarding selling your annuity future payments. HAVE A Structured Settlement Purchaser Factoring Representative Contact YOU, this site will forward your questions & requests to an established finance representative/company.

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Use Structured settlement lump sum money for new house down payment and then get $8000 back from Obama tax credit

$8,000 for homebuyers, first-time purchasers get a tax credit windfall if they buy before December.

This was previously done 10 months ago or so under Bush administration. The deal was $7500 tax credit back if a new home purchase was made. This deal had to be paid back over 15 years. The new stimulous package extended this rebate and made it a true rebate (does not have to be paid back). It is increased $500. Now is the time to trade in future settlement payemts for a cash lump sum. This can be used for down payment of a house and then $8000 more money can come your way. What are you waiting for. I am doing this, but i dont own a structured settlement. I had to come up with my down payment from savings.

There's a nice windfall for some homebuyers in the economic stimulus bill awaiting President Obama's signature on Tuesday. First-time buyers can claim a credit worth $8,000 - or 10% of the home's value, whichever is less - on their 2008 or 2009 taxes. This is link to the tax credit IRS form, seems they have not updated at this time the new details. http://www.irs.gov/pub/irs-pdf/f5405.pdf  form 5405 is the form for the home tax credit. I think this will be updated in few days or week to reflect the new credit amount of $8000 and also to remove text of not to payback over 15 years.

A big plus is that the credit is refundable, meaning tax filers see a refund of the full $8,000 even if their total tax bill - the amount of witholding they paid during the year plus anything extra they had to pony up when they filed their returns - was less than that amount. But there has been a lot of confusion over this provision.

the $8,000 credit will bring an additional 300,000 new homebuyers into the market, according to estimates by Lawrence Yun, chief economist for the National Association of Realtors.

The credit could also create a domino effect, he said, because each first-time homebuyer sale will lead to two more trade-up transactions down the line. "I think there are many homeowners who would be trading-up but they have had no buyers for their own homes," Yun said.

Who won't benefit, according to Mark Goldman, a real estate lecturer at San Diego State University, are those first-time homebuyers struggling to come up with down payments. The credit does not help get them over that hurdle - they still have to close the sale before claiming the bonus.

One state, Missouri, is trying to get around that problem by creating a short-term loan on the tax credit of up to $6,750. The state would loan borrowers the money so they could use it at closing as part of the downpayment. Then, when the buyers receive their tax credit from the IRS, they pay back the state. Other states may follow with similar programs, according to NAHB's Dietz.

Now is the time to get cash now, liquidate your structured settlement, use it for downpayment for a house. Get that tax credit from Obama stimulous that just was signed. The time is January 2009 to December 2009 for the home purchase to qaulify.

Who doesn't need a $8000 check form the government?

Read more at Obama White House stimulous web site page, IRS website or CNN Money tax section

 

Do you have a structured settlement? The structured settlement cash now guide can help you get a cash payment quote. Find out how to - Cash In a Structured Settlement.

> Free Consultation - Get structured settlement help regarding selling your annuity future payments. HAVE A Structured Settlement Purchaser Factoring Representative Contact YOU, this site will forward your questions & requests to an established finance representative/company.

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Federal legislation

In January 2002, Congress accepted Mr. Mikrut’s suggestion and changed tax law to make a statement about sales of structured settlement payments. It decided that the IRS would be able to impose a 40% tax on any difference between the value of the future payments sold and the amount paid to the person who wanted to sell. The sole exception was where the sale was approved by a Court under certain conditions. IRS Code section 5891 became effective in July 2002.

In 2001, Congress passed HR 2884, signed into law by the President in 2002 and effective July 1, 2002, codified at Internal Revenue Code § 5891.[10] Through a punitive excise tax penalty, this has created the de facto regulatory paradigm for the factoring industry. In essence, to avoid the excise tax penalty, IRC 5891 requires that all structured settlement factoring transactions be approved by a state court, in accordance with a qualified state statute. Qualified state statutes must make certain baseline findings, including that the transfer is in the best interest of the seller, taking into account the welfare and support of any dependents. In response, many states enacted statutes regulating structured settlement transfers in accord with this mandate.

Post-2002

Today, all transfers are completed through a court order process. As of November 11, 2008, 46 states(Map). have transfer laws in place regulating the transfer process. Of these, 41 are based in whole or in part on the model state law enacted by NCOIL, the National Conference of Insurance Legislators (or, in cases when the state law predates the model act, they are substantially similar).

Most state transfer laws contain similar provisions, as follows: (1) pre-contract disclosures to be made to the seller concerning the essentials of the transaction; (2) notice to certain interested parties; (3) an admonition to seek professional advice concerning the proposed transfer; and (4) court approval of the transfer, including a finding that it is in the best interest of seller, taking into account the welfare and support of any dependents.

 

Do you have a structured settlement? The structured settlement cash now guide can help you get a cash payment quote. Find out how to - Cash In a Structured Settlement.

> Free Consultation - Get structured settlement help regarding selling your annuity future payments. HAVE A Structured Settlement Purchaser Factoring Representative Contact YOU, this site will forward your questions & requests to an established finance representative/company.

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IRC section 5891(a) imposes a tax equal to 40% of the factoring discount on any person who acquires directly or indirectly structured settlement payment rights in a structured settlement factoring transaction that does not qualify for exemption under conditions that are specified in section 5891(b). The tax was implemented by the Victims of Terrorism Tax Relief Act of 2001, December 21, 2001, Public Law 107-134. The new law was a part of the tax relief and assistance package for the victims of the September 11 terrorist attacks. Temporary Regulation 157.5891-1T was issued and effective February 19th, 2003, and contained temporary regulations relating to the manner and method of reporting and paying the 40-percent excise tax imposed on any person who acquires structured settlement payment rights in a structured settlement factoring transaction that does not qualify for exemption. On July 8th, 2004, the IRS issued final regulations, Treasury Regulation section 157.5891-1, which substantially adopted and replaced the temporary regulation provisions.


In general, section 5891 applies to structured settlement factoring transactions entered into on or after February 22, 2002. The amount of the excise tax is 40% of the excess of (1) the undiscounted amount of the payments being acquired, over (2) the total amount actually paid to acquire them. The 40% excise tax does not apply, however, if the transfer is approved in advance in a final order, judgment or decree that: (1) finds that the transfer does not contravene any Federal or State statute or the order of any court or responsible administrative authority, (2) finds that the transfer is in the best interest of the payee, taking into account the welfare and support of the payee’s dependents; and (3) is issued under an applicable State statute by an applicable State court or, if applicable, by a “responsible administrative authority” with exclusive jurisdiction over the claim or proceeding resolved by the structured settlement. Rules are provided for identifying the applicable State statute and the applicable State court.


The new Excise Tax provision also provides that a factoring transaction does not affect the tax treatment of the parties to a structured settlement under the structured settlement tax rules, if those rules were satisfied at the time the structured settlement was entered into. The rules are IRC section 130 (relating to an exclusion from gross income for amounts received in connection with “qualified assignments” of liability for periodic payments, as damages or as workers compensation, on account of personal physical injury or physical sickness), IRC section 72 (relating to annuities), IRC sections 104(a)(1) and (2) (relating to an exclusion for amounts received under workers’ compensation acts or as damages on account of personal physical injuries or physical sickness), and IRC section 461(h) (relating to the time of economic performance in determining the taxable year of deduction).


The purpose of IRC section 5891, is to deter the purchasers of payment rights under structured settlements from taking advantage of recipients who are entitled to receive tax free settlement payments, including payments under settlements received by victims of the 9/11 terrorist attack. The tax is basically a penalty tax imposed on purchasers of payment rights under structured settlements. The practical effect of section 5891 is to compel such purchasers to comply with State structured protection acts (“SSPAs”), which require that transfers of structured settlement payment rights receive advance court (or administrative authority) approval. Absent an appropriate court or administrative authority order, a party acquiring structured settlement payment rights must pay, up front, a tax equal to 40% of its expected gross profit on the transaction (i.e., the difference between the total undiscounted amount of the future payments it acquires and the amount that it pays to acquire them). In conjunction with the SSPAs, section 5891 should make structured settlement recipients much less vulnerable to predatory factoring transactions. This new law not only benefits the individual that sells payment rights under his or her structured settlement but also makes clear that insurers involved in structured settlements will suffer no adverse tax consequences as a result of structured settlement factoring transactions. Prior to enactment of section 5891, the tax consequences of these transactions for insurers were uncertain.

See more at IRS.com