If you are like many of us you are considering taking a lump sum payment out of the proceeds of a personal injury lawsuit. It can seem like a good idea at the time. After all, lawyers are paid in cash and you don’t need to worry about losing your car or house or having to come up with all that money up front.
You may be thinking that all you need to do is to find an agency that offers cash payments in order to take these payments. The truth is that you need to be careful with this option. You have to consider some things before agreeing to accept any lump sum offer. Why? Read on to find out.
First of all, you should think very carefully about how much money you really want to get from the settlement. If you are trying to recoup a large amount of money then you should be willing to go for it. However, if you are only seeking a small percentage of what you are owed then you may be better off just taking the money the court allows you to. Just be sure that you understand that there will be a cost associated with this option.
You should also consult with an attorney who specializes in personal injury law. There are benefits to going to one of these firms. Not only do they know all about the laws regarding these kinds of cases, but they usually work for free. You can ask them for their advice and they can give you their recommendation. It is a very good idea to take advantage of this. You will often save a lot of money by using someone’s services instead of trying to go it alone.
Don’t forget to ask your friends and family as well. They may have heard of someone you can ask who they would recommend. If they haven’t then at least talk to them. You don’t want to end up doing business with someone who isn’t right for you. You need someone who will represent you and help you get what you deserve.
Once you have talked with an attorney and they think it is a good idea to pursue a lawsuit then you will need to find a financial institution or your own bank to act as the beneficiary. This is an important step. Your lump sum will be tax-free, but you must make sure that the money goes to you keep it.
Make sure that you know how much the sum of money will be before you sign anything or make any kind of arrangement. You don’t want to be pushed into something you aren’t comfortable with. If you feel that you don’t owe that money anyway then don’t take it from a third party. You may have to pay taxes on it.
Once everything has been set up and you have made all of the necessary payments then you should receive the lump sum check. Some people will just give it to you straight away and some will ask for some additional information in order to verify that you are the actual owner of the property. It is not difficult to follow instructions if you have been well versed in the process. When you take the lump sum payment, it is important to pay the appropriate taxes on it. This could cause additional fines for not paying these taxes on time.
It is also important to remember that you will only be taxed once the full amount of your tax bill has been paid. The money that you get from the lump sum must go towards paying off your tax bill. You should be able to find many ways to cut back on the amount that you have to pay. Talk to an accountant if you can’t seem to come up with any ways to pay down your tax bill fast.
It is very important to be careful when you give away your money. If there is a balance owing on your home, you are not required to take out a loan in order to pay off your debt. You don’t want to damage your credit rating by taking a lump sum of money and leaving yourself owing more money than you have. Don’t forget to cancel any credit cards that you may have once you have received your lump sum of money. There will be many expenses incurred after receiving this lump sum that you will need to pay for.
The lump sum of money you are receiving is a major life change. It is important that you make the best decisions you possibly can about the money you are spending. Don’t spend it on unessential items that won’t be used. Take some time to really evaluate what you have to work with. The lump sum of money you are being given is a wonderful opportunity, but you need to use it wisely.
