Tax Implications for Settling Credit Card Debt (and How to Minimize What You Owe)

settling credit card debt tax implications

Whenever you borrow money, you have a legal obligation to repay it in full. Settling debt for less than you owe is a possibility. But because it means you’re not completely fulfilling your obligation, there may be tax consequences. When settling credit card debt, tax implications may include treating the settled debt as taxable income. […]