For decades, asbestos was widely used in insulation, construction materials, and industrial products. While its fire-resistant properties made it valuable in manufacturing, we now know asbestos exposure leads to serious health risks, including mesothelioma, lung cancer, and other asbestos-related diseases. As lawsuits mounted against negligent companies, many filed for bankruptcy protection. To ensure that asbestos exposure victims could still receive financial compensation, the courts established asbestos trust funds.
This blog will help you understand what asbestos trust funds are, how they work, who qualifies, and how to file a claim to pursue the compensation you may deserve.
What Are Asbestos Trust Funds?
Asbestos trust funds, formally known as asbestos personal injury settlement trusts, were established through bankruptcy courts to provide compensation to individuals harmed by asbestos-containing products—both current victims and those who may be affected in the future. These trusts operate independently of the companies that created them, which have since filed for bankruptcy protection. By moving assets into a trust, these companies could limit legal liability while still honoring their responsibility to victims.
There are currently over 60 asbestos bankruptcy trusts in the U.S., with billions of dollars reserved for eligible claimants. These funds provide compensation for a wide range of asbestos-related illnesses, including mesothelioma, lung cancer, and asbestosis.
Who Is Eligible to File an Asbestos Trust Fund Compensation or Claim?
To qualify for an asbestos trust fund claim, you generally need to demonstrate:
- A confirmed medical diagnosis of an asbestos-related illness, such as mesothelioma, lung cancer, or asbestosis
- Proof of asbestos exposure, such as employment records, product usage, or testimony
- Evidence connecting your illness to the asbestos products or job sites linked to the bankrupt company
Even if you were exposed years ago or only briefly, you may still be eligible. Many mesothelioma victims and their families qualify for compensation even if the responsible company is no longer in business.
Claim Process with an Asbestos Trust Fund
The asbestos trust fund claims process is different from a lawsuit. Instead of going to court, you’ll submit a claim package to the trust, which includes:
- Medical Records – These must show a confirmed diagnosis of mesothelioma or another asbestos-related disease.
- Exposure Evidence – This includes details about where, when, and how you were exposed, along with supporting documents such as employment history, affidavits, or product identification.
- Claim Form – A standardized form detailing your illness, exposure, and damages.
You may also need to choose between two types of claim reviews:
- Expedited Review: Faster processing with predetermined compensation values
- Individual Review: Customized review that may result in higher payouts but takes longer
A qualified mesothelioma lawyer can help you choose the right path and ensure your claim is complete.
Can You File Multiple Trust Fund Claims?
Yes. Because many people were exposed to asbestos from multiple sources—job sites, products, or employers—you may be eligible to file with multiple asbestos trust funds. Each claim must be supported by exposure evidence specific to the bankrupt company’s products or operations.
Some victims receive compensation from several trusts, resulting in combined settlements that provide meaningful financial relief for medical bills, lost wages, and other expenses.
How Much Can You Receive from an Asbestos Trust Fund?
Asbestos trust fund compensation amounts vary. Factors that affect your payout include:
- Type and severity of your asbestos-related illness
- Trust-specific payment schedules
- Exposure history and supporting documentation
- Whether you choose expedited or individual review
According to reports, average mesothelioma trust fund payouts range from $30,000 to over $1 million across multiple trusts. However, amounts are subject to the trust’s payment percentage, which adjusts for the number of current and future claimants.
Why Legal Help Matters When Filing Asbestos Trust Fund Claims
Filing a mesothelioma trust fund claim requires detailed knowledge of the trusts’ rules, documentation requirements, and legal strategy. An experienced mesothelioma attorney can:
- Identify which trust funds apply to your case
- Collect and organize required medical and exposure evidence
- File accurate and timely claims to maximize your compensation
- Help you file additional personal injury lawsuits or asbestos trust fund claims, if applicable
Even if you already have a mesothelioma diagnosis, your claim may be delayed or denied without professional legal support. A trusted asbestos lawyer will guide you through the process and help you pursue the compensation you’re entitled to.
Can Families File a Claim After a Loved One’s Death?
Yes. Wrongful death claims can be submitted to asbestos trusts by surviving family members. These claims typically require a death certificate showing an asbestos-related illness and documentation proving the deceased’s exposure history.
Filing posthumous claims may also allow families to receive financial relief for funeral expenses, lost income, and other related damages.
Are Asbestos Trust Funds Taxable?
Understanding the tax implications of asbestos trust fund claims is a critical part of pursuing financial compensation. Here’s what victims and families need to know:
- Asbestos trust fund payouts are generally not considered taxable income under IRS rules when awarded as compensation for physical injuries. This includes settlements for asbestos-related illnesses such as mesothelioma, lung cancer, or other asbestos-related diseases.
- These payouts originate from asbestos bankruptcy trusts, which were created by bankrupt companies to compensate asbestos victims without requiring lengthy court battles or traditional asbestos lawsuits.
- Payments received through a mesothelioma trust fund claim, asbestos personal injury settlement, or similar trust fund claim are typically excluded from gross income for federal tax purposes—especially when tied to a diagnosis like mesothelioma or other asbestos-related conditions.
- However, some circumstances may change the tax status of your asbestos trust fund compensation, including:
- If your settlement involves interest payments or includes punitive damages
- If you are receiving compensation from a complex asbestos claim or multiple asbestos trust funds
- If your claim involves a personal injury settlement trust with mixed components
- To ensure compliance with tax laws and protect the full value of your claim, consult a tax advisor and an experienced mesothelioma attorney before you file asbestos trust fund paperwork.
- For anyone trying to understand asbestos trust funds, what they are, and how to claim them, working with legal professionals can clarify the claims process, explain your eligibility, and help ensure that any asbestos exposure evidence or medical records are properly documented.
Take the First Step Toward Financial Relief
If you or a loved one has been diagnosed with mesothelioma, lung cancer, or another asbestos-related disease, don’t wait. Billions of dollars remain available in asbestos trust funds, but deadlines apply, and filing errors can delay or reduce your claim.
Reach out to the Mesothelioma Asbestos Help Center today for a free consultation. Call +1 800 291 0963 or email info@mesotheliomaasbestoshelpcenter.com to get started. Our team will connect you with a trusted mesothelioma lawyer who can evaluate your eligibility, organize your documents, and help you file a successful claim.