Non-Qualified Assignment

A Non-Qualified Assignment assumes payment obligations as outlined in the settlement agreement that do not qualify for tax-free status under IRC 104(a) 1 and 2. The defendant/carrier are completely released from the future periodic payment obligation in the same way as in a physical injury/sickness or qualified case.

The Non-Qualified Assignment was developed to allow the parties to obtain closure in the same way as in physical injury cases. The defendant is able to write off the cost of settlement; and close the file, severing all ties with the plaintiff. Plaintiff is able to defer taxable compensation and legally avoid high taxes in a single year; substitute a highly rated company for the defendant; obtain a negotiated benefit stream which is very flexible and settle more easily at a more acceptable cost to the defense.