Sheppard Law Offices
Columbus, Ohio Bankruptcy Attorney Kenneth L. Sheppard, Jr.
FREE Debt Relief & Bankruptcy Consultation
FREE Debt Relief Consultation Call (614) 523-3106 or (877) 505-9455
Sheppard Law Offices
TALK TO A DEBT RELIEF & BANKRUPTCY ATTORNEY TODAY (614) 523-9455
In your Free Initial Consult, our Columbus, Ohio Bankruptcy attorney will discuss three primary ways to deal with debt. The first way to handle debt, specifically unsecured debt, is to negotiate a settlement arrangement with each creditor. This is debt settlement. The other two methods to resolve debt issues are bankruptcy and debt consolidation. You specific situation will determine which method is the best path for you take.
You may have seen on television or heard on the radio an advertisement for debt settlement. Debt settlement is an alternative to filing for either chapter 7 or chapter 13 bankruptcy relief. As an attorney with a concentrated practice in bankruptcy, debt settlement and tax, Kenneth Sheppard can explain to you the advantages and disadvantages of debt settlement and what to expect if you decide to settle your debts as opposed to filing for bankruptcy protection.
I would also mention to be leery and hesitant to work with debt settlement companies that immediately rule out filing for bankruptcy or debt consolidation. Columbus, Ohio Bankruptcy Attorney Ken Sheppard specifically practices in the area of bankruptcy and debt settlement and understands the tax ramifications of choosing each method. Many of the debt settlement companies you see on TV or hear on the radio are not law firms or attorneys and most don't even have a bankruptcy lawyer on staff to field questions about bankruptcy as a viable option.
What is debt settlement? Debt settlement involves working with one creditor individually to establish a settlement or payment plan with that creditor, which will reduce the overall amount owed to that creditor and the creditor in return agrees not to pursue the remaining outstanding debt. First, it is important to point out that debt settlement generally pertains to unsecured debts, such as medical bills and credit card bills.
An unsecured creditor may be willing to enter into a debt settlement if the debtor can pay a lump sum amount (typically 40% to 60% of the total debt) within a short time period. Also, the unsecured creditor may seek additional information about the debtor's financial situation to support its decision that it may be too difficult for the creditor to recover the full balance of the account. Based upon these two facts alone, debt settlement is not for everyone. Obtaining a lump sum of money may be too challenging for a client. Asset and/or income information of the client may be too significant to warrant a creditor's decision to enter into a debt settlement.
As a Federal Tax Attorney Ken Sheppard, Jr. helps his tax clients reach installment agreements, offers in compromise and other payment plan arrangements with taxing authorities and tax collectors such as the IRS, Ohio Department of Taxation and Ohio Attorney General Office.
There may be income tax implications to you if you enter into a debt settlement. In a debt settlement, the creditor will most likely charge-off or write-off the remaining unpaid balance of the unsecured debt. Likewise, the creditor may also issue a Form 1099 to you in that same amount it charge off. Tax Attorney Ken Sheppard can help you determine whether that cancellation of debt by the creditor must be included in your taxable income for the tax year the debt was canceled. Be aware that just because you receive a Form 1099 for cancellation of debt it is not automatic that you must include that amount in your taxable income.
At Sheppard Law Offices, we require that debt settlements be made in writing and signed by an authorized representative of the creditor before any payment is made to the creditor. This is paramount to a successful debt settlement because otherwise the creditor may just accept your payment and still attempt to collect the remaining balance of the unsecured debt. If a creditor would ever seek to attempt to collect a debt where an existing debt settlement agreement has been entered into by the parties, contact Sheppard Law Offices as we will help you resolve that problem immediately.
Sheppard Law Offices
The Columbus, Ohio bankruptcy debt relief and taxation law office of Sheppard Law Offices, LPA is conveniently located just inside I-270 off of Cleveland Ave. Our offices provide a short drive from throughout Central Ohio including counties of Franklin, Delaware, Knox, Marion, Licking, & Fairfield. We regularly serve Debt & Tax needs of clients from Columbus, Westerville, Bexley, Dublin, Sunbury, Delaware, Fredericktown, Johnstown, Centerberg, New Albany, Gahanna, Pickerington, Grandview, Upper Arlington, Clintonville, Groveport, Pickerington, Pataskala, Reynoldsburg, Groveport, Lewis Center, Worthington, Granville, the Short North, Hilliard, Plain City, Grove City, Newark, Mt. Vernon, Canal Winchester, and Lancaster.
Columbus Ohio Office
2600 Tiller Lane, Suite A
Columbus, Ohio 43231
Telephone: (614) 523-3106
Newark, Ohio Office
843 N. 21st Street, Suite 108
Newark, Ohio 43055
Telephone: (740) 345-7138
Belden Village Tower, 200
Canton, Ohio 44718
Telephone: (330) 409-2876
Mt. Vernon, Ohio Office
11 West Gambier Street
Mt. Vernon, Ohio 43050
Telephone: (740) 392-0404
We are a debt relief agency. We help people file for protection under the U.S. Bankruptcy Code.