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Wage Garnishment solutions

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Anonymous
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Wage Garnishment solutions

i have a wage garnishment situation from PSCU in the amount of $125 per month with a total balance of about $14K. Is there any hope for settling for a smaller balance, getting back in good standing, or even just stopping the garnishments and making larger regular payments. Other ideas that might help our credit?

Message 1 of 5
4 REPLIES 4
oldcreditwoes
Contributor

Re: Wage Garnishment solutions


@Anonymous wrote:

i have a wage garnishment situation from PSCU in the amount of $125 per month with a total balance of about $14K. Is there any hope for settling for a smaller balance, getting back in good standing, or even just stopping the garnishments and making larger regular payments. Other ideas that might help our credit?


Is the garnishment the result of a judgment entered against you via the courts? IOW, did you get sued? if so, then there is not much you can do, if anything, as the OC or CA now has the authority of the court behind them to collect, as a result of the judgment. The only thing you can do is pay off the balance in full, to get rid of it. Judgments are tough to deal with, and give you little recourse, if any, once they are enforced.
Message 2 of 5
RobertEG
Legendary Contributor

Re: Wage Garnishment solutions

You can make an offer to the judgment creditor to settle for less.

If they accept, they will file a notice of satisfaction with the court.

 

Be aware that if the difference between the full debt and the amount of settlement is $600 or more, they will be required to send a form 1099c to you and the IRS, which will, unless you have an exclusion, make that amount of cancelled debt taxable as income.

Message 3 of 5
oldcreditwoes
Contributor

Re: Wage Garnishment solutions


@RobertEG wrote:

You can make an offer to the judgment creditor to settle for less.

If they accept, they will file a notice of satisfaction with the court.

 

Be aware that if the difference between the full debt and the amount of settlement is $600 or more, they will be required to send a form 1099c to you and the IRS, which will, unless you have an exclusion, make that amount of cancelled debt taxable as income.


Robert, thanks for the clarification. Is the $600 threshold a federal thing? Or is each state different?
Message 4 of 5
gdale6
Moderator Emeritus

Re: Wage Garnishment solutions


@oldcreditwoes wrote:

@RobertEG wrote:

You can make an offer to the judgment creditor to settle for less.

If they accept, they will file a notice of satisfaction with the court.

 

Be aware that if the difference between the full debt and the amount of settlement is $600 or more, they will be required to send a form 1099c to you and the IRS, which will, unless you have an exclusion, make that amount of cancelled debt taxable as income.


Robert, thanks for the clarification. Is the $600 threshold a federal thing? Or is each state different?

Federal law says that.

Message 5 of 5
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