Oakland Attorney Handling Debt Forgiveness Matters
Debt forgiveness is a vital component of bankruptcy, foreclosure or short sales. Some creditors will even forgive debt following constructive negotiations. If your debt was or will be cancelled soon, it is important to understand your tax obligations.
If you have questions about how debt forgiveness applies to your situation, contact the Law Office of Lawrence L. Szabo, in Oakland, California, for help. We offer free initial consultations and serve clients living in or near Alameda County, and Contra Costa County, California.
Cancelled Debt is Taxable
In most cases of cancelled or forgiven debt - whether this involves student loans, car loans or credit card debt - the amount of debt forgiven must be reported as income on your federal taxes. However, there are some notable exceptions. For example, debt cancelled on a primary residence through a short sale, foreclosure or mortgage restructuring can often be excluded from your income taxes.
Whenever debt of $600 or more is cancelled or forgiven, your lender must issue a Form 1099-C stating the amount of cancelled debt. You will then use this form to determine the amount of income to report on your taxes.
Be Leary of Debt Settlement Programs
Have you heard or seen an advertisement for assistance with debt settlement? Many of these companies claim to negotiate with lenders and reduce debt to manageable levels. Unfortunately, these services do not always work and some may even be fraudulent. If you are in need of skilled, experienced and dedicated assistance with debt settlement matters, you should strongly consider hiring an experienced lawyer to protect your interests.
Attorney Lawrence L. Szabo has more than 25 years of experience representing clients in debt forgiveness and bankruptcy matters. No matter the situation, he will protect your interests and help ensure that you are not taken advantage of on your path toward financial freedom.
Contact a Debt Forgiveness Lawyer in Oakland
For a free initial consultation with a knowledgeable lawyer about debt forgiveness, contact us at any time. Our office is wheelchair accessible.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.