I have about K credit label debt, have been creation monthly payments compartment right away hold up was smooth. But during a impulse we am not means to have them as well as was meditative of settling a debt with them. Let’s contend we solve which for K (that is as well tall of an expectancy we guess, or record bankruptcy). How many would we end up profitable in taxes when they send me a 1099?
Forgot to supplement that:
1. we am ready to compensate a K upfront (or during a max 3 months)
2. we went to a NFCC as well as a seductiveness rates in a "Debt Management Plan" which they were charity were aloft upon many as well as reduce upon a little accounts. In a DMP, we end up me profitable some-more monthly minimums than what we am profitable during a moment!
NFCC – The National Foundation for Credit Counseling, a a single Clark Howard Suggested upon his CNN show.
1. Even if a debt is ‘settled’ as well as is upon there for 7 years, can we begin rebuilding my credit, after ‘settling’ a stream a single for contend k (assuming we am lucky) in similar to 3 months, by removing a cumulative credit card? Or usually places where we should be concerned about "Credit history/report" is (1) Home Loan (2) Car Loan (3) Credit label (4)Store Card….am we blank anything else here?
2. And what about a 1099?
If you are not behind on your payments, they aren’t going to bother settling with you. You also are not going to be able to settle for a mere 15k. That is more than a high expectation, that’s just pure fantasy.
Most likely, they aren’t going to settle for anything. They will write off the debt or charge it off, your credit will be tanked and, you will get sued. I wouldn’t count on them settling and you getting a 1099 for anything.
My estimation here is, you will be filing bankruptcy within the next 18 mos.
bankruptcy will not let the 35k cc debt be removed…
Per your update:
If you settle for $15K, they will issue a 1099c and you’ll have to add $20K to your next year’s earned income…The amount of extra tax depends on what your bracket is…Assuming a 25% bracket, you’d end up paying about $5K extra to the IRS
Update 2: Your credit rating has already taken a big hit by going past due on the credit cards. Settling is another big negative factor…but is a lesser evil than a charge-off/default. You’ll have horrible credit for at least 2 years…It could take 4 to 5 years to recover.
Ask H&R Block
In a Chapter 13 you make your own payment schedule then wait to see if the creditor accepts it or not, sometimes they don’t or won’t accept it.
$35K is a lot of money to have owed, but if you have that kind of income that can pay it off then kudos to you. You can call those creditors and speak with someone in authority and ask them for a settlement. Again, some won’t budge. Rather than going bankrupt you can try the federal program that used to be called Consumer Credit Counseling (no fee). You’d have to check their new name on the internet. They can in some instances have the creditor lop off some of the interest and the late fees.
Sounds like the account is current, they may settle with you. You just have to be honest: "Hi! I have so much debt that I am going to likely default and I want to offer a final settlement payment. I can pay 75% of the balance…. I may have to file bankruptcy then you would get much less or nothing at all. " You may have to speak with their hardship program department. If you file bankruptcy you would likely not get credit for some years.
if they settle with you —- you will be chatged off and given a poor credit rating.