Individuals in Florida and throughout the country who have a debt balance forgiven may have to pay taxes on the amount that they no longer owe. An exception may be made in the event that a debtor is insolvent or if a debt was discharged through bankruptcy. In many cases, debt forgiveness is achieved with the help of an outside party such as an attorney.

However, debtors can work directly with their creditors to negotiate a debt settlement deal on their own. It is worth noting that debt settlement is generally considered to be an option of last resort for those who cannot afford to make even the minimum payment each month. Working with a credit counselor to resolve a debt crisis may be ideal for those who need help creating a budget or learning basic money management skills.

A person who simply needs more time to pay down an existing debt balance may want to look into getting a personal loan. A credit card balance transfer may also make it easier to pay a creditor in a timely manner. If a debt is settled, it will be listed as settled on a credit report as opposed to paid in full. While that may cause short-term damage for a credit score, an individual should see his or her score rebound as time passes.

Those who choose to file for bankruptcy may be able to have some or all of their debts eliminated in a matter of weeks or months. It may also be possible to obtain an automatic stay of creditor collection activities such letters, phone calls or lawsuits. During a bankruptcy proceeding, a debtor may be able to sell his or her car, home or other property before it can be repossessed or foreclosed on.