In a recent article published by the Oklahoma Bar Journal, Kaylie S. Tucker of National Litigation Law Group (NLLG) discusses the underutilized insolvency exclusion that can help mitigate tax consequences for debt settlement program clients when negotiating debts due to financial hardship.
In the article, Tucker states, “Fortunately, the IRS has carved out several exclusions that, if applicable, can reduce the amount of canceled debt that would be reported as income.” Throughout the article, Tucker discusses the insolvency exclusion, what is required to qualify for the exclusion, and the common pitfalls for debt settlement program clients who are not aware of the exclusion.
“It is my hope that qualified debt settlement program clients will be more likely to take advantage of this insolvency exclusion moving forward and that professionals working for debt settlement companies, or with debt settlement program clients, will be more likely to refer clients to a tax professional during the duration of the client’s program enrollment,” Tucker commented.
To read the complete Oklahoma Bar Journal article, please click here.
