How do I handle interest on settlement funds?

CosmoLex Team

The handling of interest from settlement funds kept in trust accounts falls under Model Rule 1.151 regarding the safekeeping of property. Because the funds are considered to be the property of the client as long as they remain in the trust account, the client may be entitled to any interest accrued during its term in the account. In general, the … Read More

Are settlement funds taxed?

CosmoLex Team

Many plaintiffs are surprised to find their settlement funds are taxable. The amount and whether or not the funds are entirely taxable is dependent on several key items. Lawyers who are responsible for providing clients with a settlement sheet, so it’s important to keep this in mind throughout the process. Key items to note include the following[1]: Punitive damages and … Read More