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Course Details

Course Information
  • smart_display Format

    On-Demand

  • signal_cellular_alt Difficulty Level

    Intermediate

  • work Practice Area

    Personal Injury and Med Mal

Date & Time
  • event Date

    Tuesday, March 25, 2025

  • schedule Time

    1:00 p.m. ET./10:00 a.m. PT

  • timer Program Length

    90 minutes

Credit Information

  • This 90-minute webinar is eligible in most states for 1.5 CLE credits.

$197.00
CLE
ALL

This CLE webinar will offer guidance to attorneys and their trusted advisers, such as CPAs, financial planners, and settlement professionals, on avoiding the risks associated with contingent fee deferrals when using "non-qualified assignments" or "structured settlement annuities." The panel will offer a comprehensive overview of the assignment process used in structured settlements, covering both qualified and non-qualified assignments, with a focus on their history, usage, and implications for contingent attorney fee deferrals and discuss best practices for structuring settlements that minimize exposure to tax liabilities and avoid legal pitfalls.

Faculty

Phillip M. Krause
Principal
Krause Capital, Inc

Mr. Krause is the President of Krause Capital, Inc. and Structured, LLC.  He is a registered representative of FINRA and a registered investment advisor with the SEC. Mr. Krause consults on issues related to resolving mass torts, class actions and complex insurance claims. He is an expert on 468B Qualified Settlement Fund administration, structured settlement annuities and Trust administration. Recently, Mr. Krause has consulted on the NFL Concussion Settlement and the Dr. Larry Nassar – Michigan State University Settlement, where he provided advice on how to allocate settlement proceeds to claimants seeking to protect both their government benefits eligibility and settlement proceeds from future creditors.

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Sean Czepiel
Regional Director
EZTPA

Mr. Czepiel is a native of Western Massachusetts who began his career in the retirement services journey in 2006 at MassMutual after attending American International College. Spending the first 4 years of his time there crisscrossing the country as a Retirement Education Specialist before he was asked to move to New York City in 2011 to establish a local presence in the market.  After enjoying success in multiple roles throughout the company and becoming the youngest Managing Director ever hired, Mr. Czepiel joined a national Third Party Administrator and expanded his expertise in plan design, defined benefit, and the more technical side of retirement planning. He is EZTPA’s Director of Sales and is responsible for building meaningful relationships with Financial Advisors, Plan Sponsors, and centers of influence throughout the country.

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Nicole Roger Finegan
Partner
HMS Certified Public Accountants, PA

Ms. Finegan is a Partner at HMS Certified Public Accountants, P.A.

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Description

Attorneys have long used settlement annuities both to distribute settlement proceeds to the plaintiffs and to defer receipt of contingent attorney's fees, a practice approved in Childs v. Commissioner, 103 T.C. 634 (1994) if the deferral is properly structured. Over time, a variety of fee deferral solutions spun off from the Childs ruling, including offshore assignment companies, like Liberty Mutual and BARCO, and quasi-deferred compensation plans, to provide alternative solutions to structured settlement annuities, and attorneys flocked to them.

Recently, the IRS has taken the position that these alternative products are subject to further examination and scrutiny on a case-by-case basis to determine if these non-traditional solutions used to defer contingent fee income meet their intended tax obligations and abide by constructive receipt and economic benefit rules.

Counsel needs to understand how to use qualified and non-qualified assignments to defer the plaintiff's settlement and their contingent fees, the role of the assignment company in the deferral process, the risk of forfeiture as a creditor or payee, how periodic payments can be structured to align with financial planning goals, and the tax implications and legal considerations for each deferral strategy, as well as alternative income deferral options using traditional IRS approved qualified plans (i.e. 401(k), cash balance plan, deferred compensation, etc… .).

Listen as our panel of experts offers insights and strategies to address critical risks that attorneys face when structuring fees, including IRS scrutiny and potential unintended risks or tax liabilities.

Outline

  1. Introduction
    • Brief history and usage of structured settlements
    • Overview of life insurance companies offering structured settlement annuities
    • The assignment process and flow of funds
  2. Offshore assignments and their evolution
  3. IRS scrutiny: GLAM 2022-007
  4. How to defer attorneys' fees using non-qualified assignments and qualified plans
  5. Qualified plans and contribution limits
  6. Strategies and practice tips for attorneys

Benefits

The panel will review these and other issues:

  • How do personal injury lawyers make contingency fee tax mistakes?
  • Why has the IRS turned its attention to Childs and personal injury attorneys?
  • What kinds of deferred income plans will qualify?