Any debt over $600 that is forgiven will be issued a 1099 by the creditor. For example, if your debt was $20,000 and you reached a settlement of $12,000, then the forgiven debt is $8000. However the IRS will often waive this tax liability if you prove that you were insolvent during the time in which your debt settlement occurred. Many of our clients are able to prove insolvency since their debts are more than their assets.
Watch our video about debt settlement and how it effects your taxes.
PCS Debt Relief does not handle taxes. It is important to talk to your tax accountant upon receiving a 1099 to see how it will affect your taxes and for more information.
Sr. Debt Analyst at PCS Debt Relief
At PCS, our programs are tailored to the client’s specific financial needs. What sets us apart from our competitors is that clients see relief, before any payment is received. Our NO UP-FRONT FEE policy ensures our client’s a 100% satisfaction guarantee. We also do not charge any monthly fees or any cancellation fees. We want the client to feel comfortable during the whole process that’s why we allow them to be part of it every step of the way.
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