Bankruptcy

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bill1966
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bill1966
Posts: 1
Registered: ‎03-23-2008

General CC Question

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‎10-20-2008 12:38 PM

Why is it that if a credit card company takes a credit card and charges off the debt and (I would assume takes a tax break for the charge off), then in turn sells the debt to a third party that persue's a judgment. Why is this allowed to happen?, isn't it considered double dipping and both parties reaping some revenue from this.
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Timothy
Posts: 9,252
Registered: ‎03-19-2007

Re: General CC Question

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‎10-20-2008 09:31 PM

IF they collect on the "bad debt" or the consumer pays it- they have to report it as income and reverse the "charge to pofit or loss" for tax purposes.

 

Buying bad and/or "uncollectable" debt is a huge business- sold at pennies on the dollar-

 

 

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