Credit Card Debt Write-Off
Can Credit Card Debt Really
Be Written Off?
The term "write off" is one of the most misunderstood terms that consumers pick up off the internet. Pursuant to Federal Rule, a credit card consumer debt must be “written off” 180 days (6 months) after it becomes delinquent, by the company issuing the credit card. The notations “written off” may appear on a consumer’s credit report next to a reported consumer debt.
A consumer debt that has been “written off” is NOT a discharged consumer debt. A debt that is “written off” is still a debt owed by the consumer. The act of “writing off” a consumer debt DOES NOT terminate the duty of the consumer to pay the debt.
The act of “writing off” a consumer debt DOES NOT prevent the credit card issuer from suing the consumer to collect the consumer debt, including all interest charges from the date of delinquency. The act of “writing off” a consumer debt DOES NOT prevent the credit card issuer from selling the consumer debt to a debt buyer.
The fact that a consumer debt has been “written off” DOES NOT prevent a debt buyer from suing the consumer to collect the consumer debt, including all interest charges from the date of delinquency.
Often times the issuer of the credit card will also file with the IRS a form 1099C, which requires the consumer to declare as income the amount of the consumer debt “written off”.
