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I’m looking for professional advice on how to best handle old collection accounts including the credit score and tax implications. The yahoo answers community provides great information about specific questions, but I think I need to pay for services from a professional to review my personal circumstances. Is this a tax lawyer? Credit lawyer?

If anyone has experience in this situation, I’d really appreciate advice/information about the process and finding someone trustworthy.

Thank you

4 Thoughts on What type of professional can help me with collection accounts?
  1. Reply
    Age of Reason
    November 14, 2012 at 4:48 pm

    You need an accountant.

  2. Reply
    November 14, 2012 at 5:08 pm

    Yep, you need an accountant. Definitely stay away from any debt settlement, credit repair ‘lawyers’. They tend to be scams and can’t really do anything you can’t do for yourself.

    If debt is in the hands of collection agencies, you can negotiate settlement for less than full balance. You may as well settle for as little as possible. Paying off derogatory accounts won’t improve your score. The damage is done and will remain for the balance of the 7 year reporting period.

    Just be sure to get any settlement agreement in writing before you pay and don’t give the collector direct access to your bank account.

    Basic info on tax liability — you are more likely to get a 1099 for the forgiven portion of the debt from the original creditor. Collection agencies buy the debt at a deep discount and are less likely to bother with a 1099. Unless you get a 1099, you don’t have a tax liablility for the forgiven portion.

  3. Reply
    November 14, 2012 at 5:44 pm

    you need a lawyer who is well versed in consumer litigation. i am hard pressed to find one in my area. i live in a small town. you didnt mention if you are being sued or have recieved 1099’s.
    nothing is going to help your score but time. tax implications are relevant only if there was a paid settlement or forgiven either case the amount forgiven or dropped has to be over 600.00. to generate a 1099.

  4. Reply
    Kevin F
    November 14, 2012 at 6:30 pm

    You should not bother with an attorney. There is a whole industry that specializes in debt settlement and they do know the credit/tax implications. Check out the source website for an affordable option. Good luck.

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