Can my company buy my personal debt?
When your debt is forgiven, you have to consider the amount written off as an ordinary income item (with the exclusion of the debt originated from the purchase of primary home). If you're trying to write the debt off from your taxes - then it won't work. Even if you can expense the debt forgiveness, you will incur tax liability on your personal taxes side, and in addition you'll be out of cash in your business. So basically you'll end up paying it with after tax money, exactly the thing you're trying to avoid. In addition, you're dealing with related persons here, which means that the loss deduction might not be allowed (depends on the actual details of the transaction), so you might actually end up paying more taxes with this scheme that just paying off the loan directly (if your business pays taxes separately from your person). A loss on the sale or exchange of property between related persons is   not deductible. This applies to both direct and indirect transactions,   but not to distributions of property from a corporation in a complete   liquidation. For the list of related persons, see Related persons   next.
It's my understand that leasing is never the better overall deal, with the possible exception of a person who would otherwise buy a brand new car every 2 or 3 years, and does not drive a lot of miles. Note: in the case of a company car, Canadian taxes let you deduct the entire lease payment (which clearly has some principal in it) if you lease, while if you buy you can only deduct the interest, and must depreciate the car according to their schedule. This can make leasing more attractive to those buying a car through a corporation. I don't know if this applies in the US. The numbers you ran through in class presumably involved calculating the interest paid over the term of the loan. Can you not just redo the calculation using actual interest and lease numbers from a randomly chosen current car ad? I suspect if you do, you will discover leasing is still not the right choice. "I'd put more money down and avoid financing. I personally don't think car debt is good debt and if you can't afford the car, you are better off with a cheaper car. Also, you should read up on the 0% offer before deciding to commit.   Here's one article that is slightly dated, but discusses some pros and cons of 0% financing. My main point though is that 0% financing is not ""free"" and you need to consider the cost of that financing before making the purchase.  Aside from the normal loan costs of having a monthly payment, possibly buying too much car by looking at monthly cost, etc., a 0% financing offer usually forces you to give the dealer/financing company any rebates that are due to you, in essence making the car cost more." The answer will vary person to person and situation to situation.  But the basic concept to always consider is this:  What interest rate am I paying on my debt? 10%? 18%?  And what interest rate am I making on my savings/investment, etc? 3%? 7%?  It won't give you a hard and fast answer, but will definitely let you know if you should take a closer look at it.  I'd suggest talking to a financial planner about it.  Find a fee-based planner that you can turn to intermittently to make sure you are on the right track...not a commission-based planner, a fee-based one.  (with respectful apologies to any commission-based planners who may read this.) My instinct is usually to pay off the debt, try to clean everything up so you don't have anything outstanding that is charging you interest.  Debt is clutter, it's stressful, it can be a reminder of money you wish you hadn't spent.  As long as you have access to money in case of emergency, job loss, etc, get your debt paid off and keep it paid off.  You'll sleep much better. From a page on consumerfinance.gov A debt collector generally may not contact your employer or other third-parties about the debt. Debt collectors may ask your employer to verify your employment, or ask for your address or telephone number. Note - they aren't even allowed to tell the employer that they are trying to collect a debt. So - even if you were the guilty party, this isn't allowed.  They've already broken very clear laws and thus are probably not trustworthy, so (echoing what others have said) don't give them your own personal information.  If they've done one day's research on the law governing their industry they know this is illegal.  If they've actually gotten any money from your employer, it's theft.  If they haven't then it's just attempted theft.  Contact the police regardless. Also - contact a lawyer.  You may well have the right to sue them.  They've broken Federal laws in a way that causes you injury.  Odds are they've broken state laws as well. One last point - do you even have proof that these are debt collectors collecting a real debt, rather than people trying to get you to give them your SSN?  Perhaps their business plan is to look at company webpages and send bogus requests to the employers for some random employee and then see what information they get back (I'm not him, here's my personal information).  Be very careful to not give any personally identifiable information (date of birth, address, SSN, mother's maiden name, etc).  Anything they ask about you don't provide. Probably not. If you were at a small company and asked such a question, you'd get advice and links to erisa or other case law, etc.  it's safe to say that a Fortune 500 company such as IBM is going to have their facts in order, and not going to run afoul of the rules in these cases (vesting rules and takeover of other company).  I was in a company that cancelled its pension program. Those of us with the required years got the option of a lump sum payout, those with less than 5 years had no vested value and got nothing. One month longer employment, in the case of a particular coworker, would have given him a lump sum worth nearly 6 months pay. What you have to remember is you are buying a piece of the company. Think of it in terms of buying a business. Just like a business, you need to decide how long you are willing to wait to get paid back for your investment.  Imagine you were trying to sell your lemonade stand. This year your earnings will be $100, next year will be $110, the year after that $120 and so on.  Would you be willing to sell it for $100? Not necessarily. You can set any rules that you like, and you can get capital from other sources. In our company's case, you have to work there for a year before you are eligible to join the co-op. The buy in is given as an interest free loan taken through payroll deduction. We don't get to share the profits generated by the labor of people who are not members of the company. Those stay as retained earnings. We can take on loans as well as outside investment as long as the outside investors aren't given voting rights (via restricted preferred stock). 'If i co-sign that makes me 100% liable if for any reason you can't or won't pay.  Also this shows up on a credit report just like it's my debt.  This limits the amount i can borrow for any reason.  I don't want to take on your debt, that's your business and i don't want to make it mine'.