Read a debt cancellation - Law Firm lawyers Directory article here---- http://www.helplinelaw.com/docs/stampduty/maharastra.php
Most of the time cancellation of debt will remain on your credit report for seven years. If the cancellation of debt is associated with a bankruptcy, it may take 10 years.
Robbie Mochrie has written: 'Economic and theological approaches to debt cancellation' -- subject(s): Debt cancellation, Moral and ethical aspects, Moral and ethical aspects of Debt cancellation
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payable. recievable, cancellation
Cancellation of debts depending on individual circumstances can take a very lengthy time. When a debt is cancelled the creditor/collector is required to send a 1099C to the debtor and the IRS. A portion of the debt then becomes taxable income.
No anything discharged is gone.
Ask the creditor to send you written verification of the debt including all of their documents after incurring the debt. If the cancellation of the debt is not indicated in their documents, then dispute the debt by providing your written notification of cancellation of the debt to the creditor and if unsuccessful, then dispute the debt with the credit bureaus who will initiate an investigation with the creditor and the credit bureau will usually repond to you in 30 days. If no response from the creditor then it will usually be deleted from your credit report. If the collection harassment continues then ignore it realizing that probably no legal action will be taken against you or you can contact an attorney to contact the creditor. Either pay the debt or file bankruptcy.
One consideration would be that cancellation of a debt becomes income, and is taxable. But a repo isn't a cancellation of debt, it is a payment by selling the asset. However, as you can find in many discussions here, if your repossessed and the sale of the property does not return enough funds to fully satisfy the debt, the deficiency is normally not forgiven. Instead you remain owing that amount and the lender will presumably continue to try and collect it. Hence, the sale as an exchange of value isn't a cancellation of debt, and there likely isn't any even if there is a deficiency. No tax consequence.
If you received a 1099-C, cancellation of debt, you need to know your options.
On February 15, 2010 I called the State of New Jersey and asked this specific question. I was directed to reference a court case in 2000, Weintraub vs The Director. The State representative summarized the case by saying that cancellation of debt income, whether it be business or personal (such as credit card debt cancellation received on a 1099-C form) is NOT taxable for New Jersey state purposes. It is however, taxable at the federal level.
Debt cancellation is a type of credit insurance service provided by the credit card company usually for a monthly fee. In most cases, the card company will wave the outstanding balance on your card in case of your death or long term illness. The fee charged is a fixed percentage of your monthly outstanding balance. Debt cancellation is usually sold in conjunction with debt suspension and is termed DCDS. Debt suspension is a similar type of service, but instead of canceling the outstanding debt, the monthly payments may be suspended for a short period of time such as one year in the case of involuntary unemployment or some other type of unexpected life events.
Yes, it is a taxable event. I got caught myself one year by not reporting it as income.