If you are considering applying for a lawsuit loan, there is a source of cash you may not be aware of. If you have a self-funded retirement account, such as an IRA, SEPTA-IRA or Roth IRA, you can borrow against these to access cash.
If you pay the money back in six months (it is possible that your lawsuit will settle within that time), there is no penalty and no tax liability. If you do not pay back the money, you must pay tax on the funds as if it were regular income, and there will be an early-withdrawal penalty you will also have to pay.
If you do not have a self-funded retirement, this is not an option. But if you do, it is worth talking to your tax or financial adviser about using these funds to cover your living expense while you await a settlement of your lawsuit.
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