the IRS is another. If you have unpaid debt balances when you move, those balances may eventually be canceled and be reported to the IRS, at which point the unpaid debt may be considered part of your income.
If you owe more than $600 to any one company, if it’s canceled, forgiven, or discharged in a bankruptcy, it can potentially be considered income in which you now have to claim on your taxes.
Another fact to note is, your debt collectors can file a lawsuit against you. If they are already in the process of filing or file before you leave the country, it would still go before a judge and be decided in your absence.
If that happens, while the court may not be able to force you to pay while you’re overseas, the debt collector can go after any money you leave behind in a checking, savings, or investment account. And if you continue working for a U.S. based employer, they can garnish your wages.
If you’ve already left the country, depending on the size of the debt, the company may choose to bring suit against you in the country of your residency. They will hire counsel there and the case will be decided based on the laws in that country.
However, there is a caveat. Since circumstances like these come with a big price tag for the debt collector, more than often, they may consider it trivial and not worth pursuing.
Tia Muhammad, BS, is an award-winning freelance content & media creative, copywriter, blogger, digital designer, and marketing consultant. She owns the boutique content and digital media company, jackieGLDN|studio.