Nov 1

How Should Personal Injury Settlements Be Paid To Clients With Disabilities?

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“I am a personal injury attorney and am getting a settlement for my client who suffered a disability from their injury. Are there timing issues on when payments should be made from the settlement?”

 

When you have settled a lawsuit for a client and you know that the money is going to be paid out by the defendant any day now, you might have a question as to whether there’s a specific way it should go out to a client with disabilities.

Should the money be paid directly to the special needs trust?

Should I get the money in the middle of the month or the beginning of the month?

It does turn out that if you have a client who is on Medicaid, receiving a lump sum settlement is not counted as income in a month received but it’s counted as a resource in the following month. So it’s good when a settlement is paid out in the beginning of the month because that gives a client an entire month to make decisions about how the money is going to be spent and where it’s going to go.

There’s not really a timing concern as to when money goes into a special needs trust, but for the fact that there may be things that the client would like to do before putting additional money, excess money, into a special needs trust.