subject: Obama's Debt Relief Plan - How to Capitalize on Federal Tax Breaks to Eliminate Unsecured Debt [print this page] Obama's Debt Relief Plan - How to Capitalize on Federal Tax Breaks to Eliminate Unsecured Debt
President Obama's debt relief plan aims to bring the economy out of the troubled situation it is currently facing to its former glory. The economic meltdown has caused more and more people and small organizations to opt for bankruptcy. This is undesirable for both the debtors and the creditors.
President Obama's debt relief plans include the introduction of tax breaks. This may not directly eliminate unsecured debt, but helps in cutting down the expenses of ordinary household that result in an increase in their gross and net income. This increase may give them the boost to pay back their backlogs one by one. The small business organizations are highly benefited by the tax breaks.
The comprehensive tax plans introduced by President Obama includes
Cutting taxes for 95% of workers and their families (500$ for single workers and 1000$ for working couples)
Tax cuts for seniors in the middle or low income group
Tax cuts for uninsured families and home owners.
Generous tax cuts for families sending children to college.
Elimination of capital gains taxes for small business.
Reduction of corporate taxes for those firms that create jobs in the USA.
The above mentioned tax cuts are very effective in increasing the income of an ordinary household. In case they are in debt these tax cuts can help them to refrain from declaring bankruptcy.
When a person negotiates and settles dues but for a much lower percentage of what he actually owes, that discount on the amount is considered income of the individual and is therefore taxable. Initially tax was applicable to any beyond 600$. But, the internal revenue service (IRS) under the new government regulation is trying to be more lenient with the rebates.
The creditors of unsecured debts generally get tax benefits for bad debts in case of nonpayment. So the amount of loss they incur on non payment is actually not as severe as they portray it to be. The stimulus package introduced by the Obama government helps the credit organizations to cover some of their losses.
The tax breaks and the stimulus package are two important factors in president Obama's relief plans. It has inspired both the victims and the creditors to opt for settlement than declare bankruptcy. There are quite a few grants made by the government that help the jobless and near bankrupt people to set up small business which not only helps them to pay back the dues but allows a free flow of income to the house hold also. Such grants may be difficult to get but it is worth trying.
Debt settlement companies are widely available in just about every state however some are just flat out more experienced than others in debt negotiation. That's why it's so important for consumers to use debt relief networks. These networks qualify and only accept the best performing debt settlement companies.
