One of Katie's friends apparently lent her the money
(Image: Quest Red)
"She is really grateful and will work hard to pay it off, looking forward to a relaxed Christmas with everything she has behind her."
In the run-up to her recent court appearance, Katie herself was not optimistic about her prospects and even talked about her problems with the money in a trailer for her reality show My Crazy Life.
In the promo a week ago, the 40-year-old said, "I'll go bankrupt in a year, it's not so bad, I do not have to be ashamed, many people go through like me, it's just a matter of going through the motions . That has to be. "
However, after hearing them in court, Katie once again shot scenes celebrating her positive news.
She said, "I have really good news, you know that I like to prove that people are wrong?
"Well, you're wrong, I had my court today and can guess what I'm not going bankrupt, so I'm starting a new year, a fresh start, not a bankruptcy, so today's good, nothing can go wrong."
Katie's IVA was confirmed this week, but details of the deal have not been released.
A spokesman for the HMRC confirmed that the reality star was owing him money, but was waiting for a small amount than some of her other creditors.
Judge Jonathan Middleton ordered the mother of five to pay legal expenses of £ 881.