Settled debt any hidden consequences?
Date: Sat, 03/10/2007 - 08:45
Offered settlement of about 720.00 discont on amount owed. Could that amount be reported to the IRS as income? And are there negative impacts to settling v. paying in full? Note: have history of 6 payments (all on time) on this debt. Thanks!
You should receive a 1099 form from the creditor.It is going to
You should receive a 1099 form from the creditor.It is going to count on your return as income from a forgiven debt. Most creditors will place a notation on credit report as settled or settled less than full amount. You may be able to get them to mark it as paid in full,make sure it is in writing.
Last thing,most creditors don't want you to know this,but if you settle or not pay with certain creditors you can be blacklisted.
What that means is you will not be welcomed back into their bank or credit card unless you pay them in full.
