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MNAIR
Jan 3, 2007, 11:10 AM
Hi ,

From a debtors point of view is it better for me to Settle an account in full or pay in full??

If i settle an account and the Debtor writes off more than $600 -How much tax will i end up paying according to 1099c ?

Regards,
Madhavi
AtlantaTaxExpert
Jan 3, 2007, 01:39 PM
Madhavi:

From a debtor's point of view, it is always better to write off the account. You may have to pay taxes, but it will NEVER be equal to the debt.

You will pay taxes based on your marginal income tax rate, which depends on your total income.