If the debt was secured, the creditor might not have to go to court to repossess the loan collateral. If a piece of property is put up as collateral for a loan, this is called a "secured transaction.This article explains the basics of the garnishment process as a method for collecting debt after a judgment has been entered. You will have to pay taxes on the portion of the debt that is forgiven in a settlement. What is a discharge in bankruptcy? A bankruptcy discharge releases the debtor from personal liability for certain specified types of debts. File Form 1099-A, Acquisition or Abandonment of. Secured Property, for each borrower if you lend money in connection with your trade or business and, in full or. You must withhold payments for each pay period, and in most cases, send them to the state disbursement unit (SDU). Drawn or summoned to complete the jury; and such other jurors shall be impaneled as in the first instance.