1099 C- not filed

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  • This topic has 11 replies, 2 voices, and was last updated 6 years ago by jessica143.
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  • February 3, 2019 at 9:24 am #4256601
    Samantha B

      We have already filed our taxes but today received a 1099 C form from a debt cancellation. We had no idea of this form coming so of course its not on this tax return. Do you know what will happen? This debt is from a loan from a couple years ago and getting this 1099 C today is the first we have heard of the debt being cancelled. Will they take our whole refund?

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      • February 6, 2019 at 3:01 pm #4260420
        jessica143

          This link might be helpful too:

          https://www.creditcards.com/credit-card-news/1099-c-tax-form-questions-answers-1282.php

        • February 5, 2019 at 11:16 pm #4259360
          Sarah
            @sarah21

            Sorry for typos dealing with kids and dinner lol 😆

          • February 5, 2019 at 11:09 pm #4259358
            Sarah
              @sarah21

              Tri that is correct advise. Just as Jonathan said. Have it prepped, know what you owe. If you are able to claim insolvency do it, unless you have assets that could pay off the debt. Mail the amended return off once this return processes and have the refund. Do not ignore this. Ignoring this and waiting until you get a letter which is letter CP2000. That will include an accuracy penalty which you do not want. Like I said throughout this post seek a tax professional!!

              You can’t efile amended returns, my tax software is starting to do that with prior years but not current year.

              Me stating to have it amended doesn’t mean mail it now.

              As a tax professional, this is my advice. Please do yourself a favor and talk to a professional off the internet!

            • February 5, 2019 at 11:00 pm #4259351
              Tri

                Same situation. CPA said do nothing until return processes. Amend after. No idea if thats the right thing but thats the advice the CPA I consulted gave to me.

              • February 5, 2019 at 10:27 pm #4259329
                Sarah
                  @sarah21

                  Sara, that’s terrible advice. Do nothing until they get a letter lmfao! So you are wanting this person to get an accuracy penalty. You can’t efile an amended return, so having it prepared now isn’t going to affect this return being processed. For the love of all that’s holy please seek a tax professional and not people online giving you terrible advice!!!!

                • February 5, 2019 at 10:18 pm #4259322
                  Sara

                    Do not amend your return until it’s finished processing. I repeat, do not do not do not amend your return until it’s finished processing. Do nothing until the IRS mails you a letter or you get your refund. Don’t call them. Just wait.

                  • February 5, 2019 at 11:57 am #4258472
                    Sarah

                      Please seek a cpa because there is bad advise on here. It’s not too late to file an amended return. I agree with Jonathan.

                    • February 5, 2019 at 9:49 am #4258284
                      Jonathan Leissler

                        1099-C is just reporting the debt as cancelled and the IRS considers it as a form of untaxed income received. You will have to file an amendment which depending on your situation could increase or decrease your return.It happens all the time, it won’t hold anything up from your current filing. Amendments are not digital they have to be mailed in and hand processed. I would get it prepared, and once your refund hits your account, send it in along with any money due back. If nothing is due back, just mail in and wait.

                      • February 5, 2019 at 9:35 am #4258261
                        Chris

                          If the loan debt exceeds the amount of your tax return then yes, they will take every penny. In fact, they will take your return every year until it’s paid. It’s really to late to do anything about it. The only way to keep debt collectors from writing off your debt is to file bankruptcy and in your case, it’s too late.

                        • February 5, 2019 at 9:32 am #4258258
                          Chris

                            If you have a charged off debt, the debt collection agency can write your debt off as a loss on their business taxes and you’ll immediately be held responsible to pay back every penny of it to the IRS. It happens all the time with credit card and loan debt. They usually write you off as a loss when their absolutely sure that you aren’t ever going to pay or the statue of limitations has expired for the to collect.

                          • February 3, 2019 at 12:10 pm #4256670
                            Sarah

                              You need to file an amended return before they catch that. It’s considered income. If they catch that and you don’t file an amended return you’ll be subject to penalties. They won’t take thevrefund but you will owe. Please seek a CPA.

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