In every Structured Installment Sale, a legal entity called an "assignment company" sits between the buyer and the seller. It sounds mysterious. It isn't. The assignment company is typically an affiliate of the highly rated life insurance company issuing the annuity, and it is the company that owes you the payments. Below: what it is, why it exists, and how your CPA can look it up in minutes.
By Hans Goldstein, EA, Tax & Exit Planning · Updated
Admitted to practice before the IRS.
When a highly rated (A or better by A.M. Best or equivalent) life insurer funds a Structured Installment Sale, the entity that legally takes on the buyer's payment obligation is usually its assignment company: an affiliate registered with state regulators, listed in NAIC filings, and reported in the parent group's financial statements. The annuity that funds your payments is issued by the group's life-insurance company directly to that assignment company.
Same parent group, but a separate company: the assignment company is the one that owes you the payments, and you are its unsecured creditor. It owns the fixed annuity that funds them, so your payments depend on the assignment company and on that insurer. Check both names in the documents before you sign. The corporate structure exists for tax-code and regulatory reasons, not because someone is trying to hide what's going on. Carriers active in this market generally operate the same way: a parent carrier, a life-insurance subsidiary that issues the annuity, and an assignment-company subsidiary that holds the periodic-payment obligation.
Send me the sale price and rough basis. Within one business day I'll email you the actual number and the Seller's Guide to §453. If it doesn't fit your deal, I'll tell you that plainly.
No retainer · no obligation. Hans Goldstein, a licensed insurance agent (CA Insurance License #4273294), will contact you and may discuss insurance products, including annuities.
The structure was built specifically to solve two problems that arose after the Periodic Payment Settlement Act of 1982 created the modern structured-settlement industry:
In a Structured Installment Sale, the buyer of your asset doesn't actually want to be on the hook for 25 years of monthly payments to you. They want to close the deal, wire the money, get title, and be done. The assignment company solves this: at closing, the buyer pays the assignment company the present-value lump sum, the assignment company legally assumes the entire future payment obligation, and the buyer is fully released. The buyer's books are clean the day escrow closes. You get a financially-stronger obligor than the buyer ever was.
For your §453 installment-sale treatment to hold, substituting a new obligor on the buyer's note must not be treated as a satisfaction or disposition of the note under §453B. The assignment company steps into the buyer's payment promise, and the terms of the note are meant not to change. (Personal-injury structured settlements use the same assignment mechanic under IRC §130, which by its terms covers only injury and sickness claims.) For an installment sale, no IRS ruling specifically approves the assignment structure, and no published guidance addresses whether the substitution is a §453B disposition. The usual practice is to write the assignment into the original sale terms and have your own CPA or tax attorney review the documents.
Each assignment company operates as a separately capitalized legal entity holding a portfolio of annuity contracts (assets) that exactly match its periodic-payment obligations (liabilities). The matching is the point: the obligation is funded at closing by the annuity the assignment company owns. It is still a credit relationship, not a guarantee: you are an unsecured creditor of the assignment company.
▸ The corporate mapCarriers active in this market generally use this same structure. The names change; the architecture is the same.
▸ Checking the assignment companyThe assignment company and the life insurance company behind it are named in your closing documents before anything is signed. Your CPA, your attorney, or you can check both:
Carrier participation in the Structured Installment Sale market and rate competitiveness change over time. Hans works through licensed structured-settlement co-broker arrangements; the assignment company for any given placement depends on case suitability, current rates, and broker access at the time of placement.
▸ Common objections, answeredHappy to send you a redacted sample assignment addendum, point you at the relevant PLRs, and walk through what your closing-day signature pile actually looks like.
Talk to Hans: 213-414-2808It is an assignment company that accepts a structured settlement obligation under IRC §130. The defendant or its insurer pays it a lump sum, it assumes the duty to make the periodic payments, and it funds them with an annuity it owns. Section 130 lets it exclude that lump sum from its own income, which is what makes the arrangement work.
No. They are usually in the same corporate group, but the assignment company is a separate legal entity. It is the one that owes you the payments, and it owns the annuity issued by the life insurer that funds them. Your closing or settlement documents name both, so you can check the insurer's rating and the assignment company's exact legal name before you sign.
You are an unsecured creditor of the assignment company, and its main asset is the annuity that funds your payments, so in practice your security is the claims-paying ability of the issuing insurer. Insurer failures are rare but have happened: when Executive Life failed in 1991, structured settlement payees faced reduced payments during its rehabilitation. Check the insurer's current rating first.
The assignment company does. The payee is named to receive the payments but does not own the annuity or control it. That separation is deliberate: because you cannot accelerate, borrow against or assign the payments, you are not in constructive receipt of the lump sum, so the tax treatment holds.
Sources: 26 U.S.C. §130 qualified assignments; NAIC company search; IRS Publication 537, Installment Sales. Checked October 3, 2026.
