Ignore Company’s Excuses and Demand Corrections

Question: I’m in the Navy and stationed overseas. More than a year ago, I paid a $425 cell phone bill. A month later, the company billed me again for the same amount, claiming no payment was received, even though the check cleared my account. After I called repeatedly and sent copies of my bank statement and the check, the company’s customer service representatives advised me to pay only my new cell phone charges while they researched the problem.

After four months had passed, I discovered the payment had been credited to my mother’s account. Meanwhile, the company turned my account over to a collection agency. Eventually, the company acknowledged the mistake and partially credited my account with the amount that was not already used by my mother. I have no problem paying for what I owe, but the company’s foot-dragging disappointed me. What’s worse, they’ve deactivated my account. What can I do to restore my credit and possibly my account?

Answer: The problem with talking to customer service representatives is that your brain gets dulled. You lose track of what’s right and what’s wrong, what’s reasonable and what’s not, what makes sense and what’s absolutely nuts.

The company “partially credited” your account with the money your mother hadn’t already used? Beg pardon? Wasn’t this your money to begin with, and wasn’t it the company that applied it to the wrong account? How does your mother’s phone use enter into this at all?

Then there’s the issue of turning a collection agency on you, which jeopardized your credit rating, while you were paying your bill in good faith.

You should be more than disappointed. You should be absolutely outraged.

You have every right to demand three things:

* That the entire $425 payment be credited to your account instantly, if not sooner.

* That the company contact the collection agency and tell it to stop coming after you and to stop reporting any delinquency to the credit bureaus.

* That you get a letter of apology from the company acknowledging its error and the fact that it turned your account over to a collection agency by mistake. You may need this letter in the future if the collection agency continues to report a delinquency.

You also can insist on having your account reactivated, although it’s hard to imagine why you’d want to do business with this company again.

You can handle this by phone initially, but make sure to follow up in writing. If you have access to an attorney who can write the letter for you, so much the better. Be sure to mention that falsely reporting negative information to a credit bureau is a violation of the Fair Credit Reporting Act, and send copies to the company’s president as well as its marketing office.

Of course, you most likely could have avoided this mess by including your account number on the check you sent. You should always do so in the future, or consider switching to electronic payments, which leave a trail that’s much easier to track than that of a paper check.

But your lapse is no justification for how poorly the company handled this. Don’t accept excuses, don’t listen to explanations. Just be absolutely calm and firm and insist on getting what you’re owed.

Death Taxes May Be Levied on Inheritance

Q: I inherited $30,000 from my brother. Do I add that to my income when I file my income tax return?

A: You don’t owe any federal income or estate taxes on your inheritance. But you may owe state death taxes.

More than half the states, including California, effectively don’t tax such bequests, but the rest have some kind of inheritance tax. (Inheritance taxes are typically imposed on the recipient. That’s in contrast to estate taxes, which are collected from the estate.)

The states that have inheritance taxes usually have different limits for imposing the tax, depending on your relationship to the deceased. Spouses typically get the highest exemption from the tax, followed by children or parents, followed by siblings and then everyone else.

You’ll need to contact your state tax authority to find out what the rules are in your state.

Liz Pulliam Weston is a contributor to The Times, a columnist for MSN Money and a graduate of the personal financial planning certificate program at UC Irvine. Questions can be e-mailed to her at askliz weston@hotmail.com or mailed to her in care of Money Talk, Business Section, Los Angeles Times, 202 W. 1st St., Los Angeles, CA 90012. She regrets that she cannot respond personally to queries.