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CalAttorney2
CalAttorney2, Attorney
Category: Legal
Satisfied Customers: 10244
Experience:  Civil litigation attorney for individuals and businesses.
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We were just notified by a collection agency that we owe state

Customer Question

We were just notified by a collection agency that we owe state taxes for $17,000 plus...contacted state of Indiana and we were told had to deal with collection agency.Called Premier Credit and were informed we now pay them. They advised monthly payment would be $800 per monthAlso advised they've had this for past 2 years and couldn't find us? Now we pay 2 yrs late fees, etc. Can the credit company demand $800 per month? We are both retired and can't afford those payments. Thanking you in advance for your reply.
Submitted: 2 years ago.
Category: Legal
Expert:  CalAttorney2 replied 2 years ago.
You can try to negotiate a lower payment.When negotiating payment (especially for those on disability or retirement income) take into account the backdrop of bankruptcy exemptions - these are assets and income that a creditor cannot collect or levy on. You can find a list of exemptions in Indiana here: http://www.nolo.com/legal-encyclopedia/indiana-bankruptcy-exemptions.htmlAfter you have identified what assets are vulnerable to collections, you can try renegotiating your debt with the creditor - unfortunately tax debts do have a lot more leverage than other unsecured debts, but you can still use these general negotiation strategies when dealing with creditors:When trying to settle a debt, creditors generally prefer lump sums over payment plans. They are often willing to accept an amount less than the full debt (the trade off is that they get a quick payment and don't have to worry about ongoing collection costs or administration). If you do not have the ability to offer a lump sum for something the creditor will accept (some will accept a small portion, while others want close to the full amount), you can try a payment plan, these are less satisfactory to the creditor (especially if they have a lien on your property already), but if you are willing to offer something with a reasonable chance to get the creditor a large amount of their debt back, you are likely to get them to accept it.Whenever working with a creditor, make sure that you keep your communications in writing (if you speak to someone by phone, promptly send a confirmation letter to summarize your conversation), as this will help to ensure that there is no confusion later on, and you will be able to enforce your settlement against any future collection efforts.