Debt That Is Forgiven By Creditors Is Considered Income

By Alan and Brian, CPA

I had someone make a statement at work that I wanted to look into. Since it was a money related, I asked Brian who is a CPA. I wanted to know: If you have a $10,000 debt to a credit card company, and through negotiation (because you can't pay the full amount), they relieve $5,000 of debt in order for you to only pay $5,000, is it true that the credit card company will issue a 1099 to the IRS in the form of income given to you? Are there times when this would not happen? This seems like this isn't really talked about, if true.

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Legal Documents All Families Should Have

By Brian, CPA

What are the documents that any family should have in place, "just in case?"

First, a disclaimer: The author IS NOT a lawyer, and these are "lawyer" topics. It can be very persuasively argued that this is not necessarily a good "do it yourself" area. IF EVERYONE IS AGREEABLE, DIY software or similar approaches MAY do fine. But crises tend to bring the worst out in some people, something I've seen time & time again as a tax accountant doing primarily estate and trust related work.

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