topic Re: Not a good day Synchrony sent me a 1099 C from 2006. in Personal Finance

Not a good day Synchrony sent me a 1099 C from 2006.

firefox100 — Tue, 28 Jan 2020 01:15:25 GMT

Hi Today I got in the mail a 1099 C from Synchrony bank for $1700 for 2019. Had to call the number on the the 1099 C for Synchrony bank to find out what account and what year it was for. Thay told me was charge off 2006, the form show transaction date of May of 2019. I can't belive that Synchrony gave me such high credit limits on both my Walmart credit card of 18K before it went over to Capital one and my JCp card has 15K limit. Thay must not check ther records like Chase and Amex. Thay told me this was an old PC richards card that I had gone bad back aroond 2000. How Can I handle this with the IRS and state which is Ny. Will I just be stuck with this and meed to pay tax on the income.

Re: Not a good day Synchrony sent me a 1099 C from 2006.

Anonymous — Tue, 28 Jan 2020 01:18:07 GMT

You sure will.

Nothing like a surprise from the past....

Re: Not a good day Synchrony sent me a 1099 C from 2006.

firefox100 — Tue, 28 Jan 2020 01:30:44 GMT

When I did crash and burn in late 1999 and later I was able to get the IRS and state to for give the income because i had lost my eye sight had gone blind. I don't know if I will be able to get the IRS and state to do another for give it was over 100K at the time.It comes back to haunt you, I do remember the IRS was but state gave me a hard time had to go to ther own doctors.

Re: Not a good day Synchrony sent me a 1099 C from 2006.

Anonymous — Sat, 01 Feb 2020 19:34:45 GMT

Really? I thought the IRS could only collect back taxes for 10 years. Can somebody send you a 1099 from more than a decade and make you pay? I'm not sure I have 10+ year tax returns lying around to use as information to build my correction from, let alone file an amended return.

I'd call the IRS (and your state department of revenue) and see what they say. I've always been impressed with the IRS telephone service, I've never spent more than 10 minutes on the phone to complete what I needed, including hold times.

Re: Not a good day Synchrony sent me a 1099 C from 2006.

GApeachy — Sat, 01 Feb 2020 19:55:47 GMT

@firefox100 wrote:
Will I just be stuck with this and meed to pay tax on the income.

https://www.credit.com/blog/2019/01/what-you-need-to-know-about-1099-c-the-most-hated-tax-form-165180/

Re: Not a good day Synchrony sent me a 1099 C from 2006.

gdale6 — Sat, 01 Feb 2020 22:34:59 GMT

You might be able to challenge the validity of that, the law dictates when it should be issued and by what event, check with a lawyer

Re: Not a good day Synchrony sent me a 1099 C from 2006.

Anonymous — Sun, 02 Feb 2020 04:50:38 GMT

I actually got a 1099c a few years ago and had no idea it was even possible. I am through with my rebuild now, have been for a few years, but I tanked my credit back in 2008/2009 with numerous lenders. I eventually paid most everyone back through collections, settlements, and even wage garnishments.

Anyway, of the probably 7-8 lenders I burned and settled with, Discover was the only one to send me a 1099c. I either never got it or didn’t know what it was so I did not include it on my taxes that year.
Well, about 6 months later I get a letter from the IRS telling me I owe them money.

Thanks to this forum, I knew how to handle it. You just have to prove insolvency at the time of the debt default, which I more than was. I found a form online, listed my debts and assets at the time of the debt and literally just mailed the IRS that form along with their letter. Nothing else. No proof of anything. About 6 weeks later I got another letter from them telling me my balance with them was $0.00. I nearly cried in relief.
As an aside, I never paid Discover back or settled because, beyond the few initial few phone calls, they never tried to collect. A debt collector never contacted me about that specific debt. I was always waiting for it but it never happened. I got the 1099c well after that account fell off my credit, which was prob 3 years before the 7 year mark. The 1099c was for the full amount I owed them.

So, again, as I understand it, you just have to prove insolvency at the time is the debt default, not currently.
Yours is a little different than mine just because you are dealing with it before taxes are due where I just never included on my taxes and got an IRS letter a few months later.

I will say, I thought that lenders could only send you a 1099-C in the same tax year that they charged off the debt, not years later. I guess I was wrong but that’s what I always understood.

Re: Not a good day Synchrony sent me a 1099 C from 2006.

Revelate — Sun, 02 Feb 2020 15:25:03 GMT

There was another recent thread where someone explained that the 1099 might come years after the charge off. I agree it doesn't make much sense to me as a consumer but I think it's two separate events: lender declares the debt as uncollectible but still valid (CO), and lender discharges the debt entirely which is what the 1099 does: this wasn't a loan, we just gave you the money non-gift style.

AFAIK the 1099 counts for the tax year it was issued in.

As for IRS debts in general for SOL, it's actually 10 years after the assessment date (23c) which generally is 3 years after the filing cutoff for a given year... the reason for the +3 is all of us have 3 years to amend our file if needed and so the IRS won't make the assessment until that period is finished. I think it's moot in this case if the 1099 is this tax year.

Talk to a professional or pay the tax on it I think are the two options. That said I'm pretty sure even with my tax bracket last year that the tax on $1700 is going to be less than talking to a lawyer.