Many Americans carry significant credit card debt, leading some to explore debt forgiveness programs. These programs aren't a simple handout; they often involve negotiating with creditors or enrolling in debt management plans. Qualification typically depends on factors such as income, debt level, and hardship circumstances.
Debt settlement companies may negotiate with creditors to lower the total amount owed. However, this can negatively impact your credit score. Another option is debt management plans offered by credit counseling agencies, which involve making monthly payments to the agency, who then distributes the funds to your creditors.
It's important to note that forgiven debt is often considered taxable income by the IRS. Before pursuing credit card debt forgiveness, carefully research your options, understand the potential consequences, and seek advice from a qualified financial advisor.
Credit Card Debt Forgiveness: Who Qualifies?
Struggling with credit card debt? Some programs offer debt forgiveness, but eligibility varies. These programs can help reduce or eliminate the amount you owe, offering a fresh financial start. However, forgiveness often comes with specific requirements and potential tax implications. Understanding these factors is crucial before pursuing this option.
Source: Read the original article at CBS