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1099C received will i have to repay debt to collector? HELP,

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Joined: 12 Feb 2010
conciouschoice's page
Posts: 1

86 Magic Points

Subject: 1099C received will i have to repay debt to collector? HELP,
Posted on Fri Feb 12, 2010 7:23 pm  


I have received a 1099C from my Debitor stating that the debt has been cancelled and I have to declare this to the IRS.

The collection agency is telling me that I still have to pay them the full amount even thought the original debitor gave me a 1099c cancellation of debt.

Can anyone please help me? thanks so much!!!

Joined: 10 Oct 2009
debranewell2008's page
Posts: 591

111 Magic Points

Posted on Sat Feb 13, 2010 4:43 am  

I'm not exactly sure but if the original debtor has sent you a cancellation of debt then the debt is now canceled. I would try sending the collection agency a copy of it and see if that doesn't make them change their mind. Also I would send a debt validation letter and ask them to validate the debt they are trying to collect on. Most collection agencies can not do that. Also there should be others on here that can also help you in handling this. So just hang in there


Joined: 08 Feb 2010
Aaron's page
Posts: 2632

48565 Magic Points

Subject: 1099C
Posted on Sat Feb 13, 2010 6:08 am  

Hi Conciouschoice,

If you have received a 1099C from debitor, you need to declare to the Internal Revenue Service (IRS), that you are not required to pay the tax, because you were insolvent or bankrupt (whichever applies) at the time of charge off of the debt. You can do this either with the IRS form 982 or by attaching the information regarding your debts and assets.

As far as I know, nowhere in the instructions given by the IRS, is it mentioned that the collection process cannot continue after cancellation of debt under 1099C.

Still you can check into the details of the information given by IRS.
Keep in touch Smile


Joined: 28 Oct 2009
FreedomDM's page
Posts: 105
Location: Florida

2329 Magic Points

Subject: ummm..
Posted on Wed Feb 17, 2010 7:10 pm  

it depends on how the debt was satisfied. it sounds like this may be a 1099 for an account that was settled on...?

If a debt is settled on the amount saved is then considered taxable income for the following year - anything over $500.

if its a debt that was settled on and theyre asking for the taxes on the amount saved the 1099 form is legit.

See if this is ur case and get bk to me pls , happy to help

Michael J Brazier
Performance Based Debt Relief

Joined: 26 Feb 2008
fireyone's page
Posts: 4246

142 Magic Points

Posted on Thu Feb 18, 2010 3:32 am  

My mother in law got one of these forms from a house she let go. The bank sold the home and then sent her a form to take in when she had her taxes done. Apparently she had to pay taxes on the difference between what the bank sold the house for and what was left over was taxable. She did however get out of it because of her spouse dying. I guess if it is due to this then you are not responsible.

Subject: 1099c
Posted on Sat Jan 29, 2011 5:15 pm  

Once you receive a 1099c they CANNOT collect on the debt after that. Some of the rip off collection agencies will lie to you though. Say you owe 5000 and they were adding interest and fees and the debt was charged off. They will try to claim that you still owe that interest even though legally you do not. The 1099c also has a block for interest so if its not on the 1099c they know they were not legally entitled to it. Send a copy of the 1099c along with a letter to the collection agency stating that you have claimed this as income and they are not to contact you anymore. Debt cancellation is considered a gift. Basically they are claiming that they gave you the money and after that you owe nothing. Do not listen to people trying to claim they can still collect on the debt. I have checked with my tax person and attorney on the matter. Your credit reports also will have to be updated to show a 0 balance and in some cases it can be removed.

Subject: 1099c
Posted on Tue Mar 22, 2011 4:32 pm  

Hello, I too have received a 1099c for cancellation of debt on a vehicle and had to pay the IRS almost 900.00 dollars . I spoke with the IRS and an attorney. Both agreed that they can not collect on a debt that has been cancelled . However, they will not release my title to me. The collection department told me the only way I will receive my title is if I also pay them a settlement amount on top of paying the IRS. This in no way can be right ! How can a company write off a debt on taxes but still collect money? This seems wrong to me !

Subject: 1099-c
Posted on Thu Dec 01, 2011 6:05 am  

I received a 1099-c back in 2009 for a voluntary repo I did. I declared it on my 2009 taxes, but now the credit company who I have been working with to consolidate my debt is telling me it's better to settle. My credit is hurt anyway, should I or do I have to pay?

Subject: 1009 C/ Auto Lender
Posted on Tue Jan 10, 2012 7:38 pm  

I received a 1099C Schedule from my auto lender. Since I have to pay taxes on this, can I get the title to this vehicle from the lender?

Subject: 1099c
Posted on Wed Feb 01, 2012 8:23 am  

Want a1099c is file on tax.can they still after you

Subject: 1099C
Posted on Thu Feb 09, 2012 8:26 pm  

I received a 1099-C from the bank cancelling the debt and since my dad was a co-signer they are now going after him for the money? Can they even tho they cancelled the debt and the bank will be claiming that as a loss?

Subject: 1099C
Posted on Tue Sep 18, 2012 11:55 pm  

We did a short sale on a house and the made us sign a non-secure promissary note of $30,000, we told them we could not pay it and basically the realtor told us we would be able to negotiate a lower amount when it actually came to paying it. We were stupid and believe him.Well now we are getting letters from a debt collecting attorney the latest one says that they we can be 1099C'd, well if this is for forgiven debt, what does this have to do with us not being able to pay the $30,000? We did short-sale and when we pd our taxes this year our tax advisor had us collect all of the debt on the rental property and we were insolvent , on the property.

Subject: 1099c
Posted on Wed Jan 22, 2014 1:32 am  

I retired 1/1/2013, and received a 1099c, as my income is very limited. What are my options, as I can not afford to pay taxes on this?

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Posted on Tue Aug 05, 2014 5:51 pm  

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Subject: 1099c
Posted on Tue Mar 29, 2016 7:02 pm  

I received a 1099c, but I still have the vehicle. What should I do with the vehicle because I will be filing IRS form 982 (Insolvent). If I return the vehicle to the lender, can the lender turn around and put it back on my credit report. What should I do because technically the lender still owns the vehicle?

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