How Will Debt Settlement Affect My Taxes?

In this article, you will discover:

• If you need to hire a debt settlement attorney
• Bankruptcy vs. debt settlement

The easiest answer to that is any balance you do not pay is taxable income. Before signing off on a settlement agreement, talk to an accountant to find out exactly how it will affect you.

Do I Need To Hire A Debt Settlement Attorney?

It is not required that you hire an attorney for debt settlement. If your individual situation is one that can be helped by a phone call or a letter, or by offering a settlement, then you do not need to incur more debt by hiring a lawyer.

If you are struggling to communicate with the creditors, they are being unreasonable, or you are just uncomfortable with doing all the legwork yourself, then you should hire a debt settlement attorney.

You should consult the Illinois Attorney General’s website to read about debt settlement companies. Another good resource is the FTC. They will tell you what questions to ask, what red flags to look for, and equally, if not more importantly, what companies they have shut down or are investigating for poor practice. You should double-check before hiring someone. You want to be sure that you are following the guidelines set forth by the government to ensure your protection.

Are Bankruptcy And Debt Settlement My Only Options For Debt Relief?

No, there are other options. We try to think outside of the box, but the answer really depends on what type of debt that one has. For instance, student loans and medical bills might be dealt with differently. We will investigate what will be the best options for the individual.

When Is Bankruptcy A Better Option Than Debt Settlement?

Bankruptcy versus debt settlement is really a challenge for people, businesses, and creditors. If you can achieve your goal by settling up your accounts and you could afford the requirements of what they are asking you for, then debt settlement might be the right option. If you only have one or two bills, then bankruptcy should not be necessary unless the bills are just too large to manage.

Deciding to settle should be taken very seriously. If you look at the amount that you are offering and are not sure that you can do it, you should speak with someone about bankruptcy.

For more information on Debt Settlement in Illinois, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (847) 440-5998 today.