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  1. #1
    Join Date
    Mar 2005
    Location
    Florida
    Posts
    435

    Default Tax Debt Due to an Invalid 1099-C

    my BF has recently received a letter from the IRS saying that he owes back taxes from a 1099-C from 2003 tax year. the 1099-C (which he never got a copy of) is from a collection agency/junk debt buyer. he sued them in 2002 for violations of the FCRA, FDCPA, and applicable state laws. they settled, and he filed for dismissal with prejudice. I guess my quesions are:

    1. can they file a 1099-C for a debt that was never technically owed to them in the first place? ( they couldn't prove that he ever owed them, that's why he sued them for putting items on his credit report)

    2. if they are a junk debt buyer instead of a collection agency, it is my understanding that they could only write off (and therefore issue a 1099-C for) the amount that they actually paid for the debt.

    3. since they settled in 2002, isn't that when they would have had to file any IRS paperwork? shouldn't the 1099 be for the 2002 tax year, and therefore beyond the IRS's 3 year checking period?

    thanx.

  2. #2
    Join Date
    Mar 2005
    Location
    Michigan
    Posts
    28,906

    Default 1099 Problem

    Have you tried resolving the problem directly with the IRS - I believe the number you would call is 1-866-455-7438.

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