Bankrupt - Insolvent. Is there a difference?
Date: Mon, 05/18/2009 - 18:05
I've seen in some forums that there may be some tax implications when settling debt but there are exclusions for insolvency.
What is the technical difference between being bankrupt and insolvent? Don't they both mean that you have more debt than you have assets?
Thanks .....
What is the technical difference between being bankrupt and insolvent? Don't they both mean that you have more debt than you have assets?
Thanks .....
If you are under debt settlement program and your creditor agree
If you are under debt settlement program and your creditor agrees to settle the debt for less, you need to fill up 1099C form and pay tax only if your exempted amount exceeds $600.
Quote:
technical difference between being bankrupt and insolvent |
Bankruptcy is a legal process while insolvency is not. When your assets are not sufficient to cover your debts, it is the case of insolvency, but bankruptcy is dealing with your debts legally when you are unable to repay them off.
