An Income Stream is a number of periodic payments made under a contract from one party to another. For example; $1,000 per month paid for 10 years or $10,000 per year paid for 20 years.
The traditional definition of an Income Stream refers to a steady flow of income, often from a business or property.
A newer definition encompasses a longer list including 1) an income paid to a litigant from an Insurance Company as a Structured Settlement (read more) to settle a law suit; 2) an older annuity from an Insurance Company which pays a retiree a periodic payment; or 3) a lottery pay-out to a lottery winner by a State Lottery Commission.
For example, in 2007, Chicago's Mayor Daley sold the city's Income Stream from parking meter revenues (estimated to be worth in excess of 5 billion dollars over the next 75 years) to an investor group for 1.2 billion dollars.
For investors frustrated by a lack of competitive, safe, fixed interest investment alternatives; an Income Stream can provide immediate or deferred returns and absolute safety of principal.
Income Stream products pay under a number of different payout scenarios including monthly, quarterly, semiannually and annually, as well as deferred payments.
Investors who purchase Income Streams earn higher returns, pay lower income taxes and have access to their principal
Most existing Income Stream products are purchased under the supervision of a Circuit Court and must be approved by a Judge. This is done in compliance with federal and state statutes designed to ensure sellers are not taken advantage of or lose their ability to support themselves.
Purchasers who fail to acquire an Income Stream via court approval may find their stream of payments subject to a 40% penalty tax on top of the applicable federal and state income taxes.