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Charge-off question


jcro
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I wasn't reaaly sure which section this goes in, so sorry.

I know that when a company charges off a debt, they get a write off on their taxes and they are still allowed to collect on the debt. When somebody pays a debt, do they go back and change their taxes for that year? And how eager are they to collect on a debt after it has been charged off? I ask this because I am helping a co-worker get a charge off removed from the CR's and looking to settle. I am not sure how eager they will be to settle for less than the amount they want because they have been racking up interest since 2000. I am holding out for deletion.

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Yes, they do get a tax right-off when they charge the account off and yes, if & when they do collect, they have to claim that on their taxes. I'm sure that they would much rather settle and get something than just the tax break that they get from the right-off. When attempting to settle, always start low and ask for everything that you want (like deletion or updated to paid as agreed, etc). Some are more willing to settle than others.

Good luck!

Patty

paw67

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