Here is a news report about the tax consequences of debt settlement. I’m afraid to say the report really glosses over the tax implications of settling debt and makes it seem as if everyone with forgiven debt will pay taxes but that’s not true. It’s more complicated than that. They key point to watch for …
“Dear Steve, I have 2 credit card debts that total $30,000 that have not been paid in 4 years and the banks have written them off. 1 bank has already sent me a 1099 form last year and I already settled that tax debt with the IRS. I have no intention of paying these debt …
“Dear Steve, Our house was foreclosed in march 2009 in california. we had a 1st and 2nd loan. we received a 1099-A for the 1st loan, but nothing for our 2nd. when we went to get our taxes done, our tax preparer was asking for a 1099 for our 2nd so we can put it …
“Dear Steve, Last year I was hounded by my mortgage company to refinance my home. I had not been late on any payments. I was OK with my payments, not in any type of financial bind etc. I finally relented and listened. They offered to reduce my interest, but the rate wasn’t worth the charges. …
“Dear Steve, Several years ago (6-8 years) I accumulated approximately $25,000 of debt and no reasonable way to pay it back after a divorce. I dodged the creditors and collection agencies-but never had the means to pay anything to any of them. (I lived in subsidized housing,received food stamp benefits and was qualified for rehab …
A recent posting, “An IRS 1099-C Form Does Not Mean Debt is Discharged” caught my eye. It highlights a great potential risk for people that use debt settlement to eliminate their debt. The surprise is that while they think the debt settlement process has discharged their debt, it absolutely might not. A third circuit bankruptcy …