Question

CC Consolidation into loan, do I pay tax on amount negotiated off each card?

Forum|Forum|4 years ago
April 14, 2022
1 reply
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I surrendered my Credit Cards to a consolidation firm. They negotiated $$

down and paid off the debts! Then my account was changed to a loan company! Which I am now paying off!

DO I NEED TO PAY TAX on the negotiated amounts off of my CC’s

as income?

Not A Product Question

R

RobertB4444

If your creditors have written off your debt and taken a tax credit for doing so then you will receive a form 1099-C from them detailing the debt forgiveness income that you have incurred. If you have not received a 1099-C then you do not need to report the income. If they have agreed to accept a smaller amount as a settlement then the debt forgiveness income may not be received until you have completed the payments. You should consult with your consolidation company to see if you will be receiving any 1099-Cs in the future.

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