Originally Posted by badatmath
Payments would be income (no step-up in basis) to beneficiary so ruled out lump sum.
Any reason to favor one or the other? By small I am thinking 50-60K. (This is hypothetical for now so best I can do on numbers).
It would depend (almost) solely on the math.
How much would the lump sum be?
How much would the payments from the 5-year option be?
How much would the lifetime payments be?
What is the recipient's current tax bracket?
What is the recipient's age and expected lifetime?
The only other factor that comes to mind is that the current (generally lower) income tax rates are temporary and due to expire in 2025.