Pacific Life and Annuity company announced today significant changes in their structured legal fee program, or if you prefer, structured attorney fees.
Essentially the changes offered by Pacific Life are:
1. The claimant now does not need to structured any of their benefits in order for the trial lawyer or attorney to structure their legal fee on a case. This applies whether or not the claimant/plaintiff structures with Pacific Life or any other company. What this means is that they will now allow for true stand alone legal fees, thus allowing the trial lawyer to defer taxation on their fee award to future tax years, even if the client isn't structuring a dime of their award. It is a decision entirely up to the attorney and is not impacted by the clients desires to structure.
2. Pacific Life has joined other life markets in offering joint and survivor annuity benefits on structured legal fees. This means that an attorney can now select a life time annuity payment on their legal fee structure, but name their spouse as the joint annuitant. On the death of the attorney all payments will continue for the life of the spouse/joint annuitant, a crucial benefit when designing retirement plans for the trial lawyer. Any trial lawyer that has maxed out their pension plan contributions needs to be looking into the use of structured legal fees to supplement their retirement income in this fashion.
3. Pacific Life will require the use of a Uniform Qualified Assignment and Release form on all stand alone legal fee structures. This is a departure from the more commonly used Uniform Qualified Assignment form, in that it adds release language that provides for stronger security and compliance with tax standards. The point is, don't enter into a structured legal fee with out the advice and assistance of a specialist in structure legal fee's to insure the proper matching of markets and language in your settlement to the particular needs and facts of your case.
This news further proves that the trend of trial lawyers structuring their fees is accelerating and that tax planners, CPA's and trial lawyers need to be working with a settlement professional to allow their clients to take advantage of this important opportunity to defer income to future tax years.