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Interesting tidbit about 1099-c

Date: Wed, 04/15/2009 - 17:48

Submitted by goldenbast
on Wed, 04/15/2009 - 17:48

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Total Replies: 14


Ok I was looking at stuff about 1099-c..and I found this on the instructions for filling out the 1099-c stuff....



Ok so..going by the IRS, then some types of debt are NOT able to be 1099-c....heck I would almost argue that a debt collector couldn't do it at all since they are not anything listed above, it seems to me that the OC credit card company or the finance company or whatever would have to be the one to file. It references a bunch of pubs so I am going to dig into this deeper and see what I can find out.


Well I have read through Pub 4681 and even there once more it states:


So how I understand this is if you were insolvent when the debt was forgiven, you do not have to pay taxes on it. I think this is very important because many people could be considered insolvent since that is what made it impossible to pay the debts off in the first place.

But this really makes me think....that debt collectors do NOT cancel debt, only the OC cancels debt! The next time someone talks to the IRS or a tax agent, they should ask about this...because if it is how it is worded, then no debt collector should be filing 1099-c.!!!


lrhall41

Submitted by goldenbast on Thu, 04/16/2009 - 23:03

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WOW!!!!!!!that's great goldenbast.something for everyone who is trying to pay debt should look at.


lrhall41

Submitted by paulmergel on Fri, 04/17/2009 - 05:33

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Check your state laws. State laws can differ on this subject from state to state. If you live in a state with 'anti-deficiency laws' you may not owe taxes on the amount your lender lost when debt was cancelled or forgiven. You always have to file the 1099-C, but you should check with a tax advisor or attorney regarding anti-deficiency laws and insolvency requirements.


lrhall41

Submitted by IPoured on Sat, 04/18/2009 - 08:27

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"One could argue that collection agencies are a part of the lending money phase in a round about way.

It would be interesting to hear from someone who know's 100%.

I MYSELF THINK THIS STATEMENT WOULD ONLY COME FROM A DEBT COLLECTOR? HOW ARE YOU THRIVING IN THIS TERRIBL.LE ECONOMY DEBT COLLECTOR IN DISGUISE??? MY THOUGHTS AND ACCUSATIONS ONLY???????


lrhall41

Submitted by on Mon, 04/20/2009 - 01:28

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well keep the thought to yourself.FYI is a good member and does have an insider's view.that being said if the situation called for it she would give advise to fight the CA.do not throw accusations when none are called for.okay?


lrhall41

Submitted by paulmergel on Mon, 04/20/2009 - 05:15

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Yes, simmer down Guest. FYI was just doing what we all do here in this forum: posting her opinion. As it so happens, she does have a background in collections; however, I don't think that's any reason to put her down.

And she is most definitely not in disguise, most everyone that has been here on this forum for any length of time is aware of her CA experience. It's not like she keeps it a secret.

Now here's my opinion, if CA's were considered financial institutions, it might not be such a bad thing. They would certainly fall under a lot more regulation than they currently do, so their CA chicanery would be greatly reduced. As it so happens, I don't think they currently do. So I was not aware they could LEGALLY issues 1099's.

If anyone has any information to the contrary, please let us know. This is a very interesting topic that GoldenBast has started and she certainly raises some valid and interesting points.

And no, I'm not a collector in disguise either. Never worked for a CA and, barring any unnatural circumstances, never will. Just not a job I could do.


lrhall41

Submitted by FloridaRon on Mon, 04/20/2009 - 06:53

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