Back Taxes on Settled Debt
Date: Wed, 01/07/2009 - 13:06
OK I got home today with a letter from the IRS waiting for me. It says I owe almost 3,000 because I did not claim money from a debt that I settled last year.
I never received a anything from the creditor so I did not realize I needed to claim this money. Now I am not disputing this because I did have about that amount relieved from a credit card.
My question is, what is next? I really will not be able to afford to pay a whole lot. Is the interest they charge alot? What about my tax refund? They will probably keep it towards this debt?
I did not do this intentionally, I never received anything? How was I to know.
Any comments or help is greatly appreciated.
I never received a anything from the creditor so I did not realize I needed to claim this money. Now I am not disputing this because I did have about that amount relieved from a credit card.
My question is, what is next? I really will not be able to afford to pay a whole lot. Is the interest they charge alot? What about my tax refund? They will probably keep it towards this debt?
I did not do this intentionally, I never received anything? How was I to know.
Any comments or help is greatly appreciated.
reply
let the IRS know you never received a 1099-C from the creditor.they are supposed to file it when you pay a settlement with a forgiven amount over 600.00.that should be on the creditor.
Forgiven debt
I just got same letter from the IRS for my husband it said we need to pay 1000+tax from a 5000+ forgiven debt, which we did not know about, we never was contact by the creditor nor recived any 1099c and I belive his balance in this card was about $1500(about 7 years ago) and now they are claiming 5000+ forgiven debt. Any advise will be appreciated, what can we do? Thanks
