topic Re: PFD and getting a 1099 in General Credit Topics

PFD and getting a 1099

Anonymous — Mon, 22 Feb 2010 15:27:50 GMT

Is there a certain minimum if you do a PFD? If they agree to a PFD, does that mean they are agreeing to not 1099?

I am helping a relative with her SERIOUSLY bad credit. She owes SO SO SO SO MUCH!!!!! She doesn't have any more open accounts. They were all closed/charged off.

I don't want her to get sued and want to try some PFD and/or payment plans ASAP w/these creditors, but WHAT ABOUT THE 1099s?!?!

Re: PFD and getting a 1099

Anonymous — Mon, 22 Feb 2010 16:54:55 GMT

If you pay in full when doing the PFD there would be no reason for the 1099.

A 1099 can be sent for any debt forgiven $600 or more.

Re: PFD and getting a 1099

Anonymous — Mon, 22 Feb 2010 17:03:04 GMT

Well, I was going to try PFD and not always PIF. She has A LOT of debt. Wow.......she may get a lot of 1099s......

So they MUST do 1099s for over $600? If you make an agreement with the creditor(s) & are not PIF, can they agree to NOT 1099? I know they aren't apt to do so, but I am wondering if they are REQUIRED to 1099 for over $600?

Re: PFD and getting a 1099

Anonymous — Mon, 22 Feb 2010 17:08:36 GMT

I am not really sure about if they are required to send a 1099-C or not if a debt is forgiven.

And I don't know that I would even bring that up to the creditor. Go to the IRS website and read about the 1099-C or even call a consumer attorney and get a free consult. Ask about it.

Re: PFD and getting a 1099

Anonymous — Mon, 22 Feb 2010 17:13:34 GMT

Thank you.

Once, a long, LONG time ago, I asked for a forgiveness and was sent a 1099. I wasn't told about it and didn't even know what it was until I called. I'll have to research this more. I don't want to hide my head in the sand. I'd rather ask and know and not have my relative get a surprise in the mail......she'll k*ll me.....

Re: PFD and getting a 1099

Jazzzy — Tue, 23 Feb 2010 13:02:48 GMT

@Anonymous wrote:

Thank you.

Once, a long, LONG time ago, I asked for a forgiveness and was sent a 1099. I wasn't told about it and didn't even know what it was until I called. I'll have to research this more. I don't want to hide my head in the sand. I'd rather ask and know and not have my relative get a surprise in the mail......she'll k*ll me.....

I agree with not bringing up the 1099 issue if trying for a PFD.

She is far better off to get a PFD and then still get a 1099. How high is her income? What tax bracket is she in? Far too many people worry about getting 1099s when, in reality, it presents a small obligation for most people.