Litigation

Illinois Structured Settlements Will "Show More Leg" With State Tax Increase

By John Darer

"Income taxes in Illinois could soon be going up by as much as 50 percent to combat deficits in a difficult state budget", according to a CBS News report.

In what would be the first increase in 20 years, the state income tax would go from 3% to 4.5%.

Structured settlements provide a customizable stream of payments that are currently free of federal and state income taxes. While I am not lobbying for higher taxes the fact remains that the higher the tax the more sexy the structured settlement tax benefit is. If one combines the potential Illinois state income tax increase with the proposed federal income tax increases (and the threat of inevitable interest rate hikes that will result from government printing press), tort victims and workers comp claimants with large settlements and plaintiff attorneys have to give serious consideration to the structured settlement option.

A Structured settlement can be funded with annuities or with obligations of the United States government such as Treasury Inflation Protection Securities (TIPS).

Related reading

A Stupid Financial Mistake...A Big One Is Looming for The Unwary As Structured Settlement Intrinsic Values Likely To Increase In Coming Years

Full post as published by Structured Settlements 4Real on March 13, 2009 (boomark / email).