IRS PLR: Personal Injury Liability Assignment Qualifies for Exclusion From Income (IRC §130)

Where a corporation (“Assignee”) in the business of assuming periodic payment obligations entered into an agreement to settle a medical malpractice matter in which ”Minor” was injured at birth, the IRS ruled that: (1) the agreement is a qualified assignment under tax code Section 130(c), and (2) the annuity Assignee purchased to fund the payments qualifies as a qualified funding asset under Section 130(d). The payments that Minor will receive are fixed and determinable as to amount and time of payment within the meaning of Section 130(c)(2)(A) even though they are calculated pursuant to an ...