Over 60 Years of Combined Experience In personal injury Law
What to Do With Your Settlement
Regardless of whether you receive a settlement or a jury award in a personal injury case, it's important to take steps to secure whatever money you receive. This can be done through the creation of a special needs trust or structured settlement.
Additionally, tax considerations come into play depending on whether you invest a portion of your settlement, place it in a trust, or put it in a CD or IRA account. If you are unable to pay medical bills because you have not yet received a settlement or award, it's important to understand what your financial options are in the meantime. At the law office of Peach & Weathers, our attorneys can evaluate your situation and discuss the financial options available to you for protecting settlement funds and paying medical bills.
Special Needs Trusts
The court can order the creation of a "Litigation Special Needs Trust" as part of a final settlement or award in a personal injury case. Proceeds from a settlement must be set aside in a special needs trust, managed by an appointed trustee. Once a special needs trust is created, the trustee has a fiduciary responsibility to manage and disburse its assets as needed for the care and maintenance of the fund's beneficiary. In some cases, it may be possible to exempt funds in a special needs trust in qualifying an injury victim for Medi-Cal or Medicare.
While each case is different, it may be possible to participate in an income distribution pool using assets from a special needs trust. By participating in an income distribution pool, a disabled child or adult can avoid spending down his or her assets while qualifying for Medi-Cal or Medicare. The pool is administered by a trustee through a non-profit entity. If you have a young child or spouse catastrophically injured in an accident, our attorneys can explain the options available to you for securing the care and maintenance of your loved one.
Mounting Medical Bills And Personal Injury Settlements
If your initial medical or employment benefits are not sufficient to cover your total medical expenses and lost wages, you are still responsible for paying any medical bills you've incurred. The contractual arrangement between you and your creditors, bank, or medical provider is not impacted by any settlement or award you are seeking in court.
If you are unable to pay your medical bills and are having difficulty staying current on credit cards or your mortgage, declaring bankruptcy may be your only option. Under Chapter 7, medical bills can be discharged while under Chapter 13, your debt can be restructured. Additionally, declaring bankruptcy will put an end to calls and letters from creditors and may even temporarily stop foreclosure on your home.