I would still GW later. Not paying the settlement as agreed could void it. I'd rather pay $4200 in taxes (est. 30% at $14k) than pay $14k more to BofA because I didn't pay as agreed.
The balance is actually more like $24K so I am saving a little more than $14K by settling. The 1099 tax doesn't worry me too much because I have a judgement (against my ex-wife) for over $33K which I can deem bad debt and offset the 1099. I've had the CC for over 5 years but the last 2 have had a lot of late payments before the charge off so I can't see it helping my credit even if it changes to "settled for less." It's a B of A CC and I have had another car loan through them that I paid perfectly so could that help with a GW letter later? So I guess the question is, PFD now or GW later?