Received a 1099-C....

[gonzo]

...from a lender on an old ass charged off acct, like 8-10 years ago. I can't find anything in common English on the google that tells me what to do with something like this. Anyone ever run into something like this?

[Big A]

From what I remember if they forgave the debt it's now considered income, and income tax is applied. Uncle Sam get's his piece even when there is no piece.

[quikag]

If you don't report it on your tax return as income, you'll get a mismatch letter from the IRS with an estimated amount owed down the road.

Basically forgiven debt is reported as income to you, so you need to report it on your taxes.

[Sean88gt]

That is beyond the statute of limitation, so call them or consult an attorney.

[quikag]

That is beyond the statute of limitation, so call them or consult an attorney.

I don't know the laws specifically in this area, but if they've been trying for the past 8-10 years to collect on that debt and have finally given up and written it off this year, then that is why he got the 1099 this year.

[gonzo]

That is beyond the statute of limitation, so call them or consult an attorney.

Thanks man. That's the English I needed.

[CJ]

That is beyond the statute of limitation, so call them or consult an attorney.

Time starts from last report date. Lenders can report for 7 years, then 7 years after report date. I see collections from the 90's on peoples bureaus.

[bonnie&clyde]

Yeah, isnt it only 7 years??

[CJ]

Yeah, isnt it only 7 years??

^^

[Big A]

I don't know the laws specifically in this area, but if they've been trying for the past 8-10 years to collect on that debt and have finally given up and written it off this year, then that is why he got the 1099 this year.

That's what I was thinking, the statue is for collecting, not "forgiving." If the fed finds out that you have unreported income from 20 years ago they are going to want income tax AND interest.

[CJ]

Thats a common misconception bonnie.

[Sean88gt]

I don't know the laws specifically in this area, but if they've been trying for the past 8-10 years to collect on that debt and have finally given up and written it off this year, then that is why he got the 1099 this year.

My folks are going through this, their accountant handled it because it was placed by a collection agency instead of the original creditor.

Time starts from last report date. Lenders can report for 7 years, then 7 years after report date. I see collections from the 90's on peoples bureaus.

Texas has a 4 year SOL. They can still attempt to collect, but they are pissing up a rope. Time generally starts from the last transaction/payment/charge off. Once it has gone to collection, they would essentially be able to report it into perpetuity, which is why the SOL starts on the more consumer friendly end of the calender.

Yeah, isnt it only 7 years??

They can report, but check Texas, 4 years is recognized as the SOL.

[CJ]

Texas has a 4 year SOL. They can still attempt to collect, but they are pissing up a rope. Time generally starts from the last transaction/payment/charge off.

That's the key here. When the lender decides to charge it off. They can hold the debt for a very long period of time if they so choose to do. 7 years from the last report date. Lenders can continue to report a past due balance for years and years if they want to. A lot of what you a referencing is collection agencies and portfolio management companies. Most all of those laws are not for the original creditor, and are for unsecured lenders. I've always worked in the secured lending industry myself. A secured lender can continue to report for as long as they want, essentially. FPCPA does not apply to secured lenders by and large. I regularly see auto repos and charge offs from around 2000. It's better defined as 7 years of inactivity. I regularly get inquiries from these fake so called "credit cleaning" companies that don't know shit about credit or the law, making absurd accusations. Usually they will reference a 4 year SOT and then reference "collection agencies" from there forward which is kind of misleading. There is a whole lot of BS out there about credit. Also, this is mostly revolving around legal action and not credit reporting. You're talking about legal action, I'm mostly talking about credit reporting.

[Sean88gt]

That's the key here. When the lender decides to charge it off. They can hold the debt for a very long period of time if they so choose to do. 7 years from the last report date. Lenders can continue to report a past due balance for years and years if they want to. A lot of what you a referencing is collection agencies and portfolio management companies. Most all of those laws are not for the original creditor, and are for unsecured lenders. I've always worked in the secured lending industry myself. A secured lender can continue to report for as long as they want, essentially. FPCPA does not apply to secured lenders by and large. I regularly see auto repos and charge offs from around 2000. It's better defined as 7 years of inactivity. I regularly get inquiries from these fake so called "credit cleaning" companies that don't know shit about credit or the law, making absurd accusations. Usually they will reference a 4 year SOT and then reference "collection agencies" from there forward which is kind of misleading. There is a whole lot of BS out there about credit. Also, this is mostly revolving around legal action and not credit reporting. You're talking about legal action, I'm mostly talking about credit reporting.

I get what you're saying, which is why I suggest he talk to an attorney.

[gonzo]

The annoying thing is that it's not even on my credit and hasn't been for years. I barely remember the account