When to Consider Using a Qualified Settlement Fund

HomeStructured SettlementsWhen to Consider Using a Qualified Settlement Fund

A qualified settlement fund is a court-overseen settlement tool that receives settlement funds from one or more defendants. A qualified settlement fund then allows the plaintiffs the time and space needed to create a settlement plan that makes sense for them.

A good example where plaintiff attorneys can consider using a qualified settlement fund is in a complex situation where there are several different plaintiffs who will receive the settlement. If the defendant is ready to pay, but there are multiple clients, allocation issues can arise if there’s an accepted settlement that has not been allocated

By using a qualified settlement fund, plaintiff attorneys can sign a cash release with the defendant and have them pay all of the funds into the qualified settlement fund. This frees up time and space to work out any allocation issues, to pay liens, to negotiate out Medicaid and Medicare liens, and to come up with a settlement plan for the clients.

All of the standard settlement planning options are still present after funds going into a qualified settlement. Clients can opt for annuities that have the benefit of tax exemption. Attorneys can choose to defer their fees into a deferred compensation plan which allows for more flexible payment schedules.


Plaintiff attorneys can consider using qualified settlement funds for their clients if they are eager to get the settlement money out of the defendant’s hands and into a safe place while having some time and space to work up a settlement plan and take care of liens. Legal fees are then paid from the qualified settlement fund while all of the other issues are being worked out.

If you have any questions about qualified settlement funds, contact us. We work with providers and trust companies that can set up qualified settlement funds in one business day, and at a low cost.

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