Federal or state tax liens that may claim priority over settlement funds.
Context on Express Legal Funding
Tax liens represent a significant consideration in pre-settlement funding, as they can directly impact the amount of money available to a plaintiff after a settlement. These federal or state claims often take precedence over other debts, including legal funding advances. Understanding the nature of a lien and the rights of a secured creditor is crucial in assessing the viability and amount of funding that can be provided. Ultimately, outstanding tax obligations are a limiting factor that must be thoroughly investigated and addressed to ensure proper disbursement of settlement funds.
Significance: Limiting factor; tax liens often take precedence over other claims.
