Statutory Guidelines [Appendix A(5) Tres. Regs 1.46B and 1.46B-1 to B-5] regarding designated settlement funds and qualified settlement funds.
Wisconsin Designated Settlement Funds Treasury Regulations 1.468 and 1.468B.1 through 1.468B.5 are important guidelines established by the US Treasury Department for the management and utilization of designated settlement funds in Wisconsin. These regulations pertain to the tax treatment of settlement funds set aside to resolve certain liability claims. Under Wisconsin Designated Settlement Funds Treasury Regulations 1.468 and 1.468B.1 through 1.468B.5, these funds are subjected to specific rules to ensure compliance with federal tax laws and regulations. Proper adherence to these regulations is crucial for both the parties involved in settlements and the Internal Revenue Service (IRS). Wisconsin Designated Settlement Funds Treasury Regulation 1.468 outlines the general rules and guidelines for the establishment and administration of designated settlement funds. It provides a framework for the allocation, investment, and distribution of settlement funds, while ensuring that tax obligations are met. The specific sub-regulations, 1.468B.1 through 1.468B.5, further elaborate on important aspects of designated settlement funds in Wisconsin. These sub-regulations focus on specific situations and provide clarity on various scenarios. 1.468B.1: This regulation sheds light on how the fund is established and defines the eligible claimants who may benefit from the fund. It also covers the procedures to be followed during the establishment process. 1.468B.2: This sub-regulation outlines the tax implications associated with the distribution of funds from the designated settlement fund. It provides guidelines for determining the taxable year of settlement fund recipients and the tax treatment of the distributed amounts. 1.468B.3: Here, the regulation addresses the procedures and requirements for the allocation of settlement fund assets among different claimants. It establishes criteria for determining the appropriate allocation and offers guidance on how to calculate shares for each claimant. 1.468B.4: This section details the role of the fund administrator in managing the designated settlement fund. It clarifies the responsibilities of the administrator and emphasizes their fiduciary obligations. 1.468B.5: The final sub-regulation focuses on the tax consequences of the fund's termination, discussing when and how the fund may cease to exist. It delves into the tax treatment of the remaining assets or obligations of the fund upon termination. Wisconsin Designated Settlement Funds Treasury Regulations 1.468 and 1.468B.1 through 1.468B.5 serve as essential guidelines for parties involved in settlement agreements that incorporate designated settlement funds. Complying with these regulations ensures that tax obligations are met while providing a structured framework for administering and distributing settlement funds in Wisconsin.
