Ask Experts Questions for FREE Help !
Ask
    jrmint's Avatar
    jrmint Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Apr 13, 2005, 10:58 AM
    Settlement?
    About 30mins ago I offered to settle my credit card debt with mbna. The mnba rep told me that if I settle my account for anything less than 100% of the balance it will show up negatively on my credit report. Is this true?
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #2

    May 2, 2005, 07:30 AM
    Jrmint:

    Yes, it will reflect negatively on your credit report. After all, when you used the credit card, you agreed to pay it all back plus interest. You are now reneging on that agreement.

    Further, if the amount that MBNA loses on the settlement is significant (more than $600), they will issue you a Form 1099-C to you and send copies to the IRS and your state tax authority. This means that you will have to report the amount on the Form 1099-C on your 2005 tax return and pay taxes on it.

    Thought you should know.
Not your question? Ask your question View similar questions
 

Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.


Check out some similar questions!

Should I do Debt Settlement? [ 34 Answers ]

We are $65,000 in debt, (unsecured credit card debt)!! We have looked into LAWGISTIX AND SUPERIOR FINANCIAL GROUP. We are very hesitant to proceed because we have a credit score in the 700 range. We are current in all of our payments, never late, and in good standing. BUT, it is getting difficult...

Debt Settlement-What should I do [ 2 Answers ]

I enrolled in a program with Debt Shield about a year ago. I have since ended the program and settled 2 of the 4 cards on my own. The other 2 are with the same company, Discover Card, and on one account they filed suit. I answered the summons and countersued. It was been almost 2 months since I...

Car Accident Settlement [ 3 Answers ]

I was in a car accident and in May 14, 2006 will be the limit to file. I've been working with the insurance company and they want to settle for 13,500. $6,762.75 in what they claim are medical cost and 6,500.00 for my pain and suffering. My medical cost comes out to 14,000, milage @1,095.26. I...

Debt settlement [ 4 Answers ]

Has anyone had any luck with a settlement company for debt? I'm going through the company, Superior debt relief. Of course, I thought I did my research but everything sounds the same when comes to these companies. I checked the BBB in the area that this co. is in and no complaints in 36months and...

Letter for settlement [ 1 Answers ]

I have one credit card that was send to a collection lawyer. After saving for a year I now think I have enough to pay most of it. I would like some key words or sentences to use so they will accept for Offer of about 80% of the credit card. Any help before I write the letter. Total I have is...

View more questions Search