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Save money by lowering your debt and work out a settlement with your lenders.

How does debt negotiation - also known as debt settlement - work? With debt settlement, your creditors agree to receive a lower payment in exchange for being paid a lump sum by the service assisting you. Then, you pay the service that negotiated your debt each month until the negotiated amount is paid off.

There are several advantages to handling out-of-control debt this way. You avoid bankruptcy, your debt stops increasing because of accumulating interest, you no longer have to deal with creditors harassing you, and you can possibly save thousands of dollars when the amount of debt you owe is reduced. There are some consequences to your credit score when you go this route, but there are ways to minimize these, too. You can find out more by discussing the details with Statepay and its partners.

So, are you ready to reduce and settle your debt and get a fresh start? Call Statepay today at , and let us help you get relief from your out-of-control debt!

Know Your Options: Debt Consolidation & Debt Settlement

If you are in debt, you are certainly not alone. According to the Federal Reserve Board, about 44% of all Americans are in debt. If you owe an amount that has three or more zeros attached to it, then you need to get help from a credit repair service in the form of debt consolidation and debt settlement. It's no shame to be in debt, especially these days. However, it is a shame if you don't try to get any help to get out of bad debt.

All Debt is Bad, Right?

his may sound very strange, but you need to separate good debt from bad debt. What exactly is good debt? Well, things like student loans, mortgages or business loans would fall under this category. Bad credit? You guessed it, credit card debt! You can use debt consolidation for both the so-called "good" as well as "bad" debt.

What is Debt Consolidation, Anyway?

It's not the principle (what you owe) that hurts in paying it back; it's the interest that your lenders or credit card companies charge for giving you that principle in the first place. You could wind up paying twice the amount of the original loan just because of interest. This is where debt consolidation best helps.

When you get a debt consolidation loan (known by a variety of names with "consolidation" somewhere), the credit repair service pays off all of your debts. Wait you're not off the hook yet. You now owe the credit repair service all of the money they paid off. However, you pay a lot less in interest since you debt consolidation.

If you have more than one company to pay back (say if you have multiple credit cards) then instead of having several payments a month (all with their high interest chains), once you decide on debt consolidation, you only need to worry about one payment a month to the credit repair service.

What About Debt Settlement?

Debt settlement is often a part of what non-profit credit repair services offer you. You can also try this on your own, but if you don't have experience as a banker or a schoolyard bully, let a professional do this. They call your creditors (like your credit card company) and hassle to bring down the cost of the loan, which they will then pay. Theoretically, if you owe $10,000, you could wind up now owing $5000. That $5000 is your debt settlement.

Why would places like banks and credit card companies go for debt settlements? Actually, they have a lot of incentive to do so. They would rather get at least some of their money back than none of their money back. Both debt consolidation and debt settlement are options which you should consider.

Urban Myths About Debt Settlement:

A lot of people who could be legally helped by debt settlements shy away from them because of some common urban myths about them. These include:

"The collectors will call me all the time!" Actually, the debt collectors will call LESS when you have a debt settlement. Your credit repair service notifies your creditors, which notify the debt collectors they employ.

"I'll get sued!" Having debt settlement proves that you are willing to pay something instead of running off to Mexico.

"The taxes will kill me!" The taxes aren't as bad as those killer interest rates, and you might not have to pay them this year. The IRS will make you pay a tax on anything over $600 in forgiven debt. You need to check with your credit repair service for the not-so-gory details.

"Better to go bankrupt." Now that will really kill your credit rating for seven to ten years. Bankruptcy should only be a last resort.

Both debt consolidation and debt settlement will allow you to get your debt under control and to start making responsible payments towards paying off your debt. To find out more if debt consolidation or debt settlement is right for you contact Statepay by calling .

Tax Debt Rule #1: If You're In A Hole Quit Digging

It is a rule worth remembering when dealing with tax debt and back taxes with the IRS. The IRS is a sprawling bureaucratic machine with one constitutional aim (remember the 16th Amendment?) to levy an income tax without regard to States or the Census. Translation: they have one job and one job only, to collect taxes, from everyone, everywhere in the United States. So, if you are carrying the burden of tax debt, you may want to learn what you can do. Since if you owe taxes, it will not be too long before the IRS will be tracking you down.

Who is the IRS

The IRS has its roots in the creation of the Commissioner of Internal Revenue and an enactment of income taxes by Abraham Lincoln in 1862 to pay for war expenses. The income taxes were repealed 10 years later but revived by congress in 1894. However, the Supreme court ruled it unconstitutional a year later. In 1913 the idea was revived and ratified by three quarters of the States of the Union in to the 16th Amendment to the Constitution.

The IRS's role is simply stated in its mission statement: "To help the large majority of compliant taxpayers with the tax law, while ensuring that the minority who are unwilling to comply pay their fair share." So if you carry tax debt, guess which category you fall in to! And once the IRS has you in its sight, it is bound by the Constitution to carry out its duty. So, as you can imagine, there is no stopping the IRS until the matter is resolved and your tax debt settled.

The Dreaded Audit

Chief among the tools the IRS uses to accomplish their goals and to collect on tax debt is the audit. The IRS uses sophisticated computer systems that analyze tax returns and select those that have the highest probability of adjustments, have unusual expenditures for their tax brackets, whose reported income is different than what their employer had reported, among other factors. Although there are 50% fewer people being audited today than 5 years ago, only less than a quarter of those audited get away without owing additional taxes! If you carry tax debt and are audited, the odds are against you, so focus on minimizing the damage. Statepay can work with you to lessen your tax debt burden. Call to learn more.

There are three types of audit. A Correspondence audit is for minor errors and will usually be accompanied by a request to mail supporting documentation. A Field audit is when an IRS agent will verify your return in person usually at your home or office. It is usually a result of complicated returns and those that involve business operations. The Office Audit requires you to appear at a specific time and date at an IRS office with your documentation. As someone who carries tax debt you may be audited in any one of these ways.

Do Not Ignore the Audit Notice

If you ignore the audit notice the IRS can adjust your liability and the next correspondence you may get is a VERY large bill and continue to do so through fees and adjustments to your tax debt. You certainly don't want that if you are already carrying tax debt. Read the notice carefully. It will describe which specific information is being examined. That will assist you in determining what documentation you should bring to the audit.

During the audits, your return and supporting documentation will be reviewed for accuracy and whether it supports your claims. Bring it to the audit organized and easy for the auditor to follow. Replace any missing records. However, bring only the requested information. Additional information may cause a curious auditor to expand the scope of the audit. Bring ONLY copies. You should retain the originals.

Stay on point

This cannot be stressed enough! There is an old adage that says "don't help the auditor". That doesn't mean you should be uncooperative or a jerk, quite the opposite. Be as pleasant and cooperative as possible while not casually discussing expensive new cars, vacations, or anything that may give the auditor the notion perhaps you have unreported income.

Know your rights

You have the right to an appeal. The appeals agent is much more knowledgeable and experienced with a goal of settling tax debt disputes and closing cases. This may work in your favor.

The vast majority of taxpayer errors are innocent and can easily be corrected. Do not expect to easily defend your return if your claims are undocumented or questionable. If you "fudged" your deduction, 'fess up and pay the tax debt. Your best bet is to hire a qualified and experienced tax pro. You need to find the right person who understands the intricacies of working with the IRS, is qualified, and can successfully represent your case. Statepay can help you search for a qualified and experienced tax professional to help you with resolving your tax debt.

Although tax debt is burdensome and anxiety producing, it is not impossible to resolve. You need the right resources, experts and tools to help you through the process and to regain your peace of mind!