topic Re: Just got a 1099c from 12 years ago in Personal Finance

Just got a 1099c from 12 years ago

Anonymous — Tue, 28 Jan 2020 01:06:41 GMT

Hello everyone, I had a charge off about 12 years ago for 6,000 and the creditor just now sent me a 1099c that says it's for the year of 2019. Is it still taxable?

Re: Just got a 1099c from 12 years ago

Anonymous — Tue, 28 Jan 2020 01:10:42 GMT

Yes. A debt is a debt regardless of how long ago it's been.

Re: Just got a 1099c from 12 years ago

Anonymous — Tue, 28 Jan 2020 01:22:02 GMT

Okay I wasn't sure not that it matters because I had zero income last year. I just didn't want to file a return to report the 1099. Thanks for your answer.

Re: Just got a 1099c from 12 years ago

SouthJamaica — Tue, 28 Jan 2020 02:33:48 GMT

@Anonymous wrote:
Hello everyone, I had a charge off about 12 years ago for 6,000 and the creditor just now sent me a 1099c that says it's for the year of 2019. Is it still taxable?

It doesn't make sense to me that it would be taxable. I think you should consult with an accountant.

Re: Just got a 1099c from 12 years ago

Jnbmom — Tue, 28 Jan 2020 02:42:34 GMT

You might want to look at IRS website regarding them.

From what I know and have heard there is not really a timestable and since they can try to collect until the cows come home , they often will eventually send a 1099c? But I could be mistaken of course. I suggest you visit the IRS site, they have some info on it.

Re: Just got a 1099c from 12 years ago

Anonymous — Tue, 28 Jan 2020 04:40:45 GMT

That's odd. I wonder why they chose to send one now then, if you had zero income. Makes me wonder if they'll try to send every year until you do pay towards it?

Re: Just got a 1099c from 12 years ago

Anonymous — Tue, 28 Jan 2020 06:14:46 GMT

1099C for $6K shouldn't actually cost you anything because the standard deduction is $12,200 and you had no income.

Should actually be pretty straightforward. You can use something like TurboTax Free File (this is mandated by an IRS agreement to withhold their own free filing software plans as long as the tax software companies offer those with income under a certain limit access to their full software suite free of charge, it's not that "free" version that tries to get you to upgrade if you have anything other than basic income and tax situations) since you're way under the income limit which would walk you through the whole process or you can speak with an accountant or tax professional.

https://freefile.intuit.com

I would at least go through the process and fill out the basic forms to find out if you will even have liability and just skip the filing if you're not sure and consult a professional. It would suck to waste money for something TurboTax could have handled for free.

Re: Just got a 1099c from 12 years ago

AverageJoesCredit — Tue, 28 Jan 2020 12:28:13 GMT

No clue as to your question but just wanted to say nice to see ya around @Anonymous

Re: Just got a 1099c from 12 years ago

M_Smart007 — Tue, 28 Jan 2020 16:24:48 GMT

It seems I have seen a few 1099c post show up.

Re: Just got a 1099c from 12 years ago

AzCreditGuy — Tue, 28 Jan 2020 16:39:27 GMT

This is a post were I feel no one should even be given advice at all until a lawyer is contacted, period. There are factors on the IRS website that should be legally verified for your matter.

Re: Just got a 1099c from 12 years ago

Revelate — Tue, 28 Jan 2020 18:33:30 GMT

@AzCreditGuy wrote:
This is a post were I feel no one should even be given advice at all until a lawyer is contacted, period. There are factors on the IRS website that should be legally verified for your matter.

True but you should still free file a return anyway... and if I were going to get dinged for a credit sin out of my past, please please please give me that 1099C when I'm out of work for the year. .

That said I'd be curious as to how this is really counted. Issuing the 1099C in 2019? Actually walking back the math this would be just shy of the SOL the IRS uses on tax filings, but presumably Cap 1 understands what the rules are better than I do... a 1099C is literally: this is your problem now, not ours.

Re: Just got a 1099c from 12 years ago

Anonymous — Tue, 28 Jan 2020 18:24:22 GMT

@M_Smart007 wrote:
It seems I have seen a few 1099c post show up.

That time of year I suppose, so anyone with a CO in their past could get one. Ten years does seem a long time, but I've recieved one from long ago and forgotten. Back in 17 I believe was one I got from about 8 years prior.

So I think they tend to keep track and go after a person when they feel you're in a better position?

I've never recived one during the years of no income just after my accident and inablity to work.

Re: Just got a 1099c from 12 years ago

M_Smart007 — Tue, 28 Jan 2020 18:37:15 GMT

@Anonymous wrote:
@M_Smart007 wrote:
It seems I have seen a few 1099c post show up.
That time of year I suppose, so anyone with a CO in their past could get one. Ten years does seem a long time, but I've recieved one from long ago and forgotten. Back in 17 I believe was one I got from about 8 years prior.

So I think they tend to keep track and go after a person when they feel you're in a better position?
I've never recived one during the years of no income just after my accident and inablity to work.

"So I think they tend to keep track and go after a person when they feel you're in a better position?"

I feel that is kind of Rotten they do that.

I understand "Life Happens" .. just glad I never had a charge off., But I did Have a Voluntary Vehicle Repo in 1993 (Hard Times)

But I paid it off, and redeemed the vehicle from the Repo yard. Then disputed the item on My report until they removed it.

Re: Just got a 1099c from 12 years ago

Revelate — Tue, 28 Jan 2020 18:37:52 GMT

@Anonymous wrote:
@M_Smart007 wrote:
It seems I have seen a few 1099c post show up.
That time of year I suppose, so anyone with a CO in their past could get one. Ten years does seem a long time, but I've recieved one from long ago and forgotten. Back in 17 I believe was one I got from about 8 years prior.

So I think they tend to keep track and go after a person when they feel you're in a better position?
I've never recived one during the years of no income just after my accident and inablity to work.

Yeah, but a 1099C isn't really going after anyone because they don't see a dime of it. It's just writing it off the books and dumping it (and you) on the IRS instead. Basically says we gave this person money, wasn't a gift, tax people figure it out... not our problem anymore. Actually now that I think of it accounting wise they probably get to deduct that as an operating expense which is why I'm guessing they do it.

Going after you would imply collections and/or judgements.

Re: Just got a 1099c from 12 years ago

Anonymous — Tue, 28 Jan 2020 18:58:10 GMT

Yes, reading that just clicked and made sense to me.

I was wondering that in the back of my mind, since it's no longer a collection or debt they're actively trying to recover.

However, is it not them who decides what year to submit to IRS? Does that mean they essentilly sat on said debt 8-10 years before finally sending out a 1099c?

Re: Just got a 1099c from 12 years ago

Revelate — Tue, 28 Jan 2020 19:54:25 GMT

@Anonymous wrote:
Yes, reading that just clicked and made sense to me.

I was wondering that in the back of my mind, since it's no longer a collection or debt they're actively trying to recover.
However, is it not them who decides what year to submit to IRS? Does that mean they essentilly sat on said debt 8-10 years before finally sending out a 1099c?

That's what happened. I have to admit that while I'm curious on such things I never got to the people who made those decisions in the FI's I've worked for that could've really explained it from a finance perspective. They had these debts on the books, they are marked in some non-performant state, and that has to be tracked somewhere.

That said I thought a Charge Off in general was "we have no hope of collecting" and a 1099 would be sent immediately but I think what it might be is if a 1099C is issued they literally have no legal right to the debt anymore: a CO I know can still be paid to the OC, but once they have sent that to the IRS they and nobody else has any rights to the debt except the IRS gets their cut potentially.

I think that's how it works legally but I'm not an expert, talking to a professional would absolutely be righteous if that 1099C is non-trivial though it sounds like in this case it wasn't.

Re: Just got a 1099c from 12 years ago

Anonymous — Tue, 28 Jan 2020 20:21:25 GMT

Googled IRS 1099C and was disheartened to see such a form could be issued whenever. Sad! A creditor could do it to be mean as now the IRS is informed and they expect action.

Re: Just got a 1099c from 12 years ago

Revelate — Tue, 28 Jan 2020 20:38:07 GMT

@Anonymous wrote:
Googled IRS 1099C and was disheartened to see such a form could be issued whenever. Sad! A creditor could do it to be mean as now the IRS is informed and they expect action.

I doubt there's any meaness or other emotion in it honestly when we're talking lenders: this is going to be an accounting / finance decision.

That said, if I did ever lend someone money and they flaked: here's your 1099C.

Re: Just got a 1099c from 12 years ago

Anonymous — Wed, 29 Jan 2020 00:01:56 GMT

@AzCreditGuy wrote:
This is a post were I feel no one should even be given advice at all until a lawyer is contacted, period. There are factors on the IRS website that should be legally verified for your matter.

Taxes are very straightforward when you're poor. If your income is less than the standard deduction, you don't have to worry about anything else. $6K is less than the $12,200 in income the IRS allows people to deduct as a living expense. Done deal as long as you qualify for the standard deduction which has a few exceptions on the website: https://www.irs.gov/taxtopics/tc551

Re: Just got a 1099c from 12 years ago

wa3more — Wed, 29 Jan 2020 01:14:38 GMT

Yes , this 1099c must be included as income when you file. Chase sent me a 1099 7 years after charge off

the creditor writes off the after 180 days and takes the loss against income. They must file a 1099 but timing doesn't matter. The IRS says you received constructive income to satisfy the debt so this is viewed as taxable income.

OPs situation has probably improved precluding the filing of form 982 for insolvency. Tax law says you can exclude 1099 income up to point of insolvency.