Detailed Answer

When a minor in Washington receives a settlement (for personal injury, wrongful death, insurance, or another claim), the law treats those funds differently than ordinary parental money. In many cases you can get money for the child’s health care and education before they turn 18, but the pathway depends on how the settlement is handled and how large or risky the release is.

Key legal frameworks and where to look

• Washington’s probate and guardianship laws control court-supervised access to minors’ funds. See the Washington Revised Code of Washington, Title 11 (Probate and Trust Law) for the governing statutory framework: https://app.leg.wa.gov/rcw/title11/.
• The Washington court system maintains forms and guidance for probate, guardianship, and minor settlement proceedings: https://www.courts.wa.gov/forms/.

Common routes to access a minor’s settlement funds

1. Court-approved settlement or guardian of the estate:

   If a settlement requires judicial approval (common when a claim is asserted on behalf of a minor), a court can approve payment terms, create a guardianship of the minor’s estate, or direct how funds will be held and spent. The court can order funds paid into a supervised account or trust and can authorize payments directly for medical bills, tuition, or other needs before the minor turns 18.

2. Custodial or trust arrangements:

   The settlement can be placed into a custodial account, trust, or structured settlement. A custodial account (often set up under state custodial laws) or a trust can allow the custodian or trustee to use funds for the minor’s benefit, including education and medical expenses. A structured settlement (annuity) provides scheduled payments that can be timed to help with college costs.

3. Direct payment for current expenses:

   Courts commonly authorize direct payment of settlement proceeds to pay the child’s outstanding medical bills, ongoing medical treatment, or educational costs. The judge will usually require documentation (estimates, invoices, school bills) and may limit disbursements to items that clearly benefit the minor.

4. Minor settlement approval hearing:

   When a petition is required, the court typically appoints a guardian ad litem or attorney to represent the child’s best interests. The judge reviews the settlement’s fairness and the proposed distribution. If approved, the judge will enter an order authorizing access to funds in specified ways.

Typical requirements courts consider before allowing early access

• Proof that the expense benefits the minor (invoices, school costs, medical provider bills).
• A proposed plan for how remaining funds will be secured for the minor (trust, custody account, bond).
• An accounting showing fees, costs, and any attorney fees to be paid from the settlement.
• Appointment of a guardian of the estate or trustee when large sums are involved.
• Representation or appointment of someone to protect the child’s interests (guardian ad litem or counsel for the minor).

Practical examples (hypotheticals)

Example 1 — Medical bills now, remainder later:

Parents obtain a $50,000 settlement for a child’s injury. The hospital has $12,000 in outstanding bills and the child needs ongoing therapy. The parents petition the court. The judge orders $12,000 paid directly to providers, approves payments for documented future therapy up to a set amount, and directs the court clerk to place the remaining funds into a supervised custodial account or trust until the child turns 18 or until further court order.

Example 2 — College funds before 18:

A minor receives a settlement that will cover future college tuition starting when the child is 17. The parents ask the court to release a portion to a college savings trust or to pay tuition directly. The court can authorize payment to a university or a trustee for educational expenses if the judge finds the plan serves the child’s best interest and protects the remaining funds.

Alternatives and tools commonly used

• Structured settlements (annuity contracts) that schedule future payments timed to tuition or living needs.
• Trusts tailored for minors (minor’s special needs trust or education trust) with a trustee who can authorize payments.
• Custodial account under applicable state custodial law or bank custodial accounts that allow parental control with some protections.

When you likely need a lawyer and/or court action

• If the settlement is large or the insurance company insists on court approval.
• If parties dispute how funds should be used or whether to accept a settlement.
• When structuring a trust, structured settlement, or setting up a guardianship/estate for the minor.

Costs, timeline, and practical steps

1. Collect documentation: medical bills, school invoices, cost estimates.
2. Talk with the insurer or settlement payer about how they will disburse funds (direct to providers, to parent, to court).
3. If court approval is required, file a petition to approve the settlement and request specific disbursements. The court schedule for hearings and orders typically takes weeks to months depending on local backlog.
4. Expect court costs, filing fees, and possible guardianship/trust setup fees. Attorney fees for negotiating and getting approval are often paid from the settlement (court reviews reasonableness).

Tax and benefit considerations

Settlement proceeds can have different tax implications depending on the nature of the award (compensatory vs. punitive vs. lost wages). Large settlements can also affect means-tested benefits. Consult a tax adviser or attorney before finalizing big settlements or spending proceeds that could affect eligibility for benefits.

Where to get official forms and local court rules

Use the Washington Courts forms site for probate and guardianship petitions and for local court contact information: https://www.courts.wa.gov/forms/. For the statutory framework governing probate and guardianship proceedings, see Washington’s Revised Code of Washington (Title 11): https://app.leg.wa.gov/rcw/title11/.

Helpful Hints

• Document everything. Keep medical bills, school invoices, and letters from providers to present to a judge or payer.
• Do not spend large settlement checks without confirming whether court approval or a guardian-of-estate is required—banks and payers may freeze or reject improper withdrawals.
• Ask the payer how they will code the disbursement and whether they require a court order for release.
• Consider structured settlements or a trust if you need funds periodically for college or long-term care; these can protect funds from mismanagement and preserve benefits eligibility.
• Get professional help if the settlement is substantial, if parties do not agree, or if benefit eligibility could change (attorney and tax advisor).
• When in doubt, contact your county probate court clerk or the Washington Courts forms site for guidance about filings and hearings: https://www.courts.wa.gov/forms/.