IRS Issues Favorable Ruling on Wrongful Life Claims
Oct 16, 2019, 05:15 ET
DENVER, Oct. 16, 2019 /PRNewswire/ -- Arcadia Settlements Group announced today that Structured Settlement Consultant John McCulloch, in conjunction with Randy Levine of Sage Settlement Consulting and the National Structured Settlements Trade Association (NSSTA), have successfully obtained a favorable Private Letter Ruling from the Internal Revenue Service on the taxability of wrongful life cases.
Parents may file a wrongful life claim against their physician or health care provider if they were not properly warned of the existence of a potential congenital disorder prior to the conception or birth of a child, and were thus deprived of information that would have allowed them to make the decision to prevent, terminate or continue the pregnancy. Parents in such situations are faced with substantial medical costs related to the care of children born with congenital disorders.
"The Private Letter Ruling, or PLR, provides clarity that these settlements are income tax free. Tax-free status means that more money remains available for children's future care and opens the possibility of structuring these settlements as well," said Mr. McCulloch, who co-authored the ruling along with David Shechtman of Drinker, Biddle & Reath. "By using structured settlements, the funds grow tax free and can be tailored in a variety of ways to precisely meet a child's specific medical needs for their entire life."
The PLR was requested on behalf of a specific client with a wrongful life claim. Had the claim been subject to taxes, much of the settlement would have been lost. Thanks to this ruling, the family will have the funds necessary to provide ongoing medical care for their children.
Additional information about the ruling can be obtained by contacting John McCulloch at jmcculloch@teamarcadia.com or (630) 864-8420.
About Arcadia
Arcadia Settlements Group helps resolve conflicts, reduce litigation expenses and create long-term financial security for people involved in personal injury claims through settlement consulting services. The company has a rich history as the first structured settlements firm in the world. In more than 45 years in business, Arcadia has helped settle over 300,000 claims involving structured settlement funding of over $30 billion. Arcadia has more than 160 experienced settlement professionals across 60 offices in the United States and Canada. For more information, visit www.teamarcadia.com.
SOURCE Arcadia
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