tax free status and judgment free

Currently I am a District of Columbia resident. I was awarded a settlement in a personal injury case last year. The incident happened while working onsite in Houston TX and was settled there also since I secured laywers near where the incident occured even though I continued to be a resident of DC throughout the ordeal. I was under the impression from my personal injury lawyers that all money recieved from the settlement was tax free and judgement free. The majority of the settlement is currently in an annutity of which I recieve monthly payments from directly to my checking account. My questions are 1.) Are the monthly payouts liable to any type of judgment that might be levied against me? 2.) Since I invested most of the money distributed so far is only the accumulated $$ subject to judgment and not the princple itself that was initially invested? 3.) Is the annuity itself safe from any judgment that could be levied against me? 4.) Is only the interest on any money I recieve the only taxable portion of my income? 5.) I want to make sure being a resident of DC doesn't affect the safety of any money to be recieved as well as any money currently recieved. 6.) Is there a maximum to the yearly amount of money to be distributed from my settlement that would not be tax free 7.)I would like to keep what I have accumulated as a result of the settlement should anything unforseened happen and a resulting judgement be levied against me. If that would require me moving to another state or placing my funds somewhere they will be safe then I will do that. I am not opposed to relocation and have been considering FL as a residence at least partial year or at leat for residency.

If your lawyer was correct and none of the settlement was taxable, then only the portion of the annuity you receive that represents income from the annuity is taxable. The portion that represents return of principal is not.

However, neither the principal nor the income from you funds is protected from personal creditors. However, there probably are ways to protect at least part of it. If this is a serious concern of yours, I would suggest you contact a lawyer familiar with asset protection, probably lawyers specializing in estate planning would qualify. The planning done should be tailored to your individual assets, needs, and plans.