I am thinking of taking help from a settlement company since I'm not able to pay my debts myself. I'm hopeful that a settlement company can help me by negotiating a lower payoff with the settlement company. However, I have to pay professional fees. But, I'm wondering, are debt settlement fees tax deductible? Can I mention this in my tax documents for the deduction?
By signing up a debt counseling session, your provided details (Name, Email ID and Phone No.) will be forwarded to the company advertising on the DebtCC. However, you have no obligation to use their services.
Some creditors and collection agencies refuse to lower the payoff amount, interest rate, and fees owed by the consumer.
Creditors/collection agencies can make collection calls and file lawsuits against the consumers represented by the debt relief companies.
Debt relief services may have a negative impact on the consumer's creditworthiness and his overall debt amount may increase due to the accumulation of extra fees.
The amount which the consumer saves with the use of debt relief services can be regarded as taxable income.