IRS 1009C for credit card debt older than SOL
If an old credit card debt was past SOL more than a year ago and the 1099C was not issued, then it is too late.
If the three year time frame for auditing a tax return ends, and SOL is past, how can a collector issue a 1099C?
This is an IRS law:
The statute of limitations limits the time during which an action can be brought by the IRS for a tax audit and the time for IRS tax collection activities. Generally, there is a 3-year statute of limitations for the IRS auditing a tax return and a 10-year statute of limitations for the IRS collecting tax.
Debt Collection SOL's Triggering 1099C
Wow I hope you're right -- you posted on this on 12/25/08 and Nascar_Devil posted about this on 12/26. I thought a taxpayer has to report it even if SOL expired for collection, judgment, unless taxpayer was/is insolvent. I.E. taxpayer gets a 1099C from OC, DB, CA, in 2009 when debt was charged off in 1997. So I guess the OC, DB, CA still get the write off from IRS years later, but the debtor no longer is required to pay taxes on the charged off amount since the IRS SOL for collecting tax trumps this. Wish I new the section of the law you're referring to that absolves the taxpayer in these cases. I guess the bottom line is the IRS wants the 1099C's to see who is forgiven "income" so IRS can do an SS match to collect from taxpayers, although some may not be required to under the IRS' SOL. I read that Portfolio Recovery Associates has been sending out a ton of 1099C's -- I guess it's to cover their behinds. I guess they don't worry about justifying all those 1099C's inspite of them being issued some 10 years later. So then telling CA's the SOL expired on collection/payment, rather than sending dispute/validation, ID theft letters everytime it gets sold/bought off may not be harmfull after inspite of triggering a 1099C.
Just because the SOL on a debt has passed, doesn't mean that the
Just because the SOL on a debt has passed, doesn't mean that the debt has been forgiven. It just means that they cannot sue. You still owe the debt. If they are sending out the forms on SOL debts, then I should be getting a few in the mail soon. This is new news to me.
