1099C

Income from the discharge of an indebtedness arises in the calendar year in which an obligation is either satisfied at less than face value, or is forgiven.

The IRS actually defines when a debt is deemed as "cancelled" - mainly 1) if settled for less than full balance or 2) if there has been no bona fide collection activity on the account for 3 years (??). You can go to the IRS website, and lookup instructions on 1099C for the actual period.

You really cannot request that a debt be cancelled. As long as the creditor intends to collect on the debt, and as long as they actually do perform collection activities within the IRS time frame, it is not cancelled.

I have a 30K credit card debt. Bank settled for $8500. They will send me a 1099C. How much will I have to pay to the IRs.

Must a person list a canceled debt on his/her tax return, if he/she did not receive a 1099C from that canceled debt?

When will a bank issue the 1099C on a foreclosure? Will they wait until
they sell the house?

I know my vacant land property was foreclosed upon, only because I searched the records online. The bank has never sent me any notice other than their intent to foreclose way back in Feb 2009...nothing since. I expect to receive a 1099c this year for the charge off but what do I do if I don't receive one? I don't know what the amount will be.

I recieved a 1099c from a very old collection debt. I have been on unemployment for over a year now. How will that effect me. On taxes.

I received a 1099a for a foreclosure in the beginning of 2009. In mid 2009 they actually sold the property. The FMV value is different that the actual sold value. I reported the 1099a as a sale with a capital gain on Schedule D of the 1040 and I was able to fall under the exclusion bracket and not pay taxes. Now I am wondering were they supposed to send me a 1099c for the ACTUAL sale and I report the difference of the actual sale price in Mid 2009 on IRS form 982? Or will they send this in the following tax year?

I recieved a 1099a for foreclosure in 2006...I recieved nothing else. The fmv is $117,000 the amount owed is $105,000. I did my taxes this year and inquired once again if I should be getting a 1099c. The tax adviser advised that since the FMV is greater than what is owed, that I would not have to claim anything. Just checking to make sure that I haven't missed something that is time sensitive and I end up owing for late filing.

You wrote "If you are served a 1099A, and the Fair Market Value (FMV) is less than the debt, then you may get a 1099C next year. However, if the FMV is greater, you may not receive the 1099C. "

I received 1099A for the first loan with FMV=250k, my first loan was 240k and second is 60k. But I haven't received the 1099C from the second lender. What is going to happen?

Property was Deeded in Lieu of,in 2005 to lender & lender paid me 1K to do it..then in 2008 lender sent a 1099C claiming 98K to IRS, few months back IRS sent me a tax bill for the 1099C of 2008. wrote to IRS explaining, now IRS is asking for FMV and said they would adjust 08 tax bill.. What does all this mean.. from my tax working I should not have any tax bill..? never received a 1099A or C from lender.. Have no clue.. any light on this ? thanks

If I got a 1099 c of 4983.89 how much do I need to pay

My ex and I settled for less than we owed on our credit cards in 2005 and we never claimed it as income on our taxes as we did not know anything about it, and to my knowledge never received any 1099's (which I know the irs does not take into account) ... my question is, can the irs still come after us 5 years later for not reporting the settled amounts as income? they have never done so to this point

I had a credit card debt of about $6,000 in 1998, which I did not pay. The bank, and then credit agencies hounded me for five or six years and then I heard nothing further. Today I received a call from a new credit card agency advising that they had just purchased my debt, which they calculate to be $24,000 and that they will send in a 1099c unless I pay them 25% of the debt. Am I dead?

My investment is now close to $120,000, I owe 219,000 and I bought it
for $255,000. I need to go through a deed in lieu of foreclosure since it
is impossible to keep paying it at my 76 years old.
What can I do to avoid a deficiency judgment?

Aaron - I am in California where I understand that the SOL is seven years. I don't have records that go back that far but I don't believe that I've made a payment since 2000. The three credit bureaus do not show an unpaid debt. The collection agency (CRA) recently made an unauthorized credit inquiry - altho I don't know how you can determine if it's a "hard" inquiry. Since making my entry of 6/26/2010, I have received a letter from CRA asking me to either pay the debt or full, or make payment arrangements. I have declined to do either and have sent CRA a Debt Validation letter.

Thank you for your response. Sorry for the confusion but in my case CRA stands for Credit Recovery Associates, a collection agency. The four year SOL has clearly past as the original creditor, MBNA, sold out to B of A five years ago - and I did nothing to toll the statute. I think that I had an MBNA credit card, but that was 12 years ago. My main concern here is the 1099c. I will report further when I hear back from my CRA.

i have credit card debt that has never been settled. the statue of limitations ran out last month on the debt. will i still get a 1099c. or when will i get anything about that? if i never settle the credit card debt what happens then with the 1099c. the credit card was 2000.00 now with interest it is 3545.00 which amount will you have to pay taxes on?

The best thing to do is get a free online copy of your crdeit report by going to experians website. On the form you can dispute the debt and the company may remove it. It may come off on its own after several years but there is no limit to how many times and can be re-reported

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