THE FIRST QUESTION that most people ask about structured settlements is "what the hell is it?" And, the answer usually involves a bunch of legal and financial terms that makes them feel pretty stupid and shut up in shame. Well, actually it's pretty easy. Let me explain by example. Say, you are a lucky victim of a car accident, whose personal injury lawyer just got him a six-figure settlement. Oh, and you also have been happily receiving welfare and Medicaid ever since you dropped out of high school. Well, naturally, now that you are rich, the state drops your Medicaid coverage and takes you off welfare. Of course, you don't give a fuck - now, you are rich! Within the next few months, your money is all spent on fast cars and loose women and you are left in the same position as before the settlement, only with no welfare. And, then the I.R.S. comes knocking, asking you for its share of the pie. That's when you begin wishing that you knew what a structured settlement is when you got that money in the first place.
If you knew a structured settlement attorney when you got awarded your settlement, he would figure out a way to break that lump sum payment into a bunch of smaller payments, payable to you over many years - and he would do so in a way that your existing benefits wouldn't get affected. He would even calculate how to break the money down, so that you have to pay a minimum in taxes. Basically, a structured settlement lawyer is in the business of cheating the government out of its hard-earned tax money. It's a booming business - as more people realize that a few grand a month for the rest of their lives are better than a million or two all at once, that would be spent in a heartbeat on mansions, golden faucets, dubious business ventures and then, inevitably, bankruptcy lawyers.