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  • Spectacular!

    I liked your fast, friendly service. You were all knowledgeable in the area of bankruptcy. Your treatment of me as a client was spectacular! You were great at promptly responding to my questions and concerns. I loved that you provided courteous and quick responses to all my questions.
    --Donna
  • Highly Recommended!

    I have worked with Seth and he is the utmost professional in how he works with his clients. If you need an attorney you can trust I would highly recommend the Law Office of Seth Hanson.
    --David
  • Very Professional.

    Everyone was very professional and efficient. Seth, and everyone that I had contact with were very knowledgeable. I was very pleased with how we were treated by his staff. My questions were always answered promptly. I was very pleased with the service I received and would not hesitate to refer someone to your firm.
    --Anonymous
  • Non-judgmental.

    You were very open and answered all of my questions. You never made me feel like I was asking a dumb question. I was comfortable with your knowledge of the law. It was hard for me to make this decision to move forward in my life. Everyone was friendly to me and respectful. Non-judgmental. Every question I asked was answered promptly and appropriately. I would recommend you.
    --Anonymous
  • More Than Expected!

    I found the firm's representation to be more than what I expected. I was always kept in the loop, all my questions were answered (whether or not I asked more than once the same question), and I felt completely supported by the firm staff when going through this (at times) scary ordeal. Thank you again.
    --Joanna
  • Very Impressed!

    I liked that you had very friendly, caring staff. You were all very knowledgeable. Your treatment towards me was excellent and you quickly responded to all my concerns. If a friend asked of your overall impression, I would say that we were very impressed and we would recommend you to them.
    --Danielle

Discharge Vs. Forgiveness Of Debt

There are times when a creditor will write off its losses and stop attempting to collect from you. They may decide the balance you owe is uncollectible or perhaps you offered to settle the debt for a lesser amount in exchange for forgiving the remaining balance. Either way, you no longer have to deal with that lender pestering you and you are home free, right? What a lucky break for you! Or is it? 

IRS

If a creditor forgives your debt and you have not filed bankruptcy, you probably still have a new liability to worry about. What gives? What part of “debt forgiveness” creates this problem? It turns out that although you no longer owe money to your creditor who you now potentially have a new creditor to deal with, the IRS. 

Cancellation of Debt Form

When a debt is forgiven, the creditor usually informs the IRS and you will receive a 1099C form reflecting a cancellation of debt. Debt that is forgiven outside of bankruptcy is typically treated as taxable income so, at the end of the year, you may generate a new tax liability. If you had filed before this forgiveness occurred, you would not be liable to either your original creditor or the IRS. This is a big reason to file bankruptcy before your creditor has a chance to forgive your debt. 

If you have questions about the bankruptcy process feel free to reach out to your Fairfield bankruptcy attorney at (707) 385-0422. 

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