If a creditor files a 1099-C (and I had to file as misc. income on my taxes) Cancellation of Debt, is the debt still collectible? 9 Answers as of April 04, 2014

The 1099-C box 2 shows amount of Discharged Debt. Doesn't that mean that it is discharged or forgiven?

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SmithMarco, P.C.
SmithMarco, P.C. | Larry P. Smith
Nope. Not at all. I think it violates the FDCPA to even try.
Answer Applies to: Illinois
Replied: 4/4/2014
Joseph Lehn, Esq
Joseph Lehn, Esq | Lehn Law, PA
The debt is not collectible. That form lists the amount of debt as "discharged debt".
Answer Applies to: Florida
Replied: 4/4/2014
Musilli Brennan Associates PLLC
Musilli Brennan Associates PLLC | John F Brennan
I believe you would be generally correct.
Answer Applies to: Michigan
Replied: 4/4/2014
James T. Weiner & Associates, P.C.
James T. Weiner & Associates, P.C. | James T. Weiner
generally yes.. if they discharged the debt you do not owe it.
Answer Applies to: Michigan
Replied: 4/4/2014
Patrick W. Currin, Attorney at Law | Patrick Currin
The debt is forgiven and therefor gone, but the amount is now ordinary income for you for tax purposes.
Answer Applies to: California
Replied: 4/4/2014
    The Law Office of Darren Aronow, PC
    The Law Office of Darren Aronow, PC | Darren Aronow
    Yes it is discharged, this is just for record keeping for the creditor. You should still give this to your accountant but should not be considered income. Bankruptcy and insolvency Even if you receive a Form 1099-C from a lender, you still may be able to avoid taxation on the forgiveness of a debt. If your debt was discharged in a Title 11 bankruptcy proceeding, such as a Chapter 7 or Chapter 13 case, you're not responsible for taxes on that debt. If you can demonstrate to the IRS that you were insolvent at the time the debt was cancelled, you can similarly avoid taxes on that debt. Certain other types of debt, including qualified farm indebtedness and qualified real property business indebtedness, can also avoid taxation in the event of cancellation.
    Answer Applies to: New York
    Replied: 4/3/2014
    Coulter's Law
    Coulter's Law | Coulter K. Richardson
    Yes it does. Creditors often sell their bad debt in big packages and debt collectors try to collect on alleged debts that have already been paid off or are too old. It happens all the time. It is a pain, but you have to defend yourself. Advise the debt collector that the debt has been cancelled and any collection efforts will be in violation of the FDCPA.
    Answer Applies to: New Jersey
    Replied: 4/4/2014
    Law Office of Stuart M. Nachbar, P.C.
    Law Office of Stuart M. Nachbar, P.C. | Stuart M. Nachbar
    File form IRS 982
    Answer Applies to: New Jersey
    Replied: 4/4/2014
    Edelman, Combs, Latturner & Goodwin, LLC | Daniel A. Edelman
    This is an issue on which the caselaw is not in agreement. There is an argument to be made that it is no longer collectible. You should probably not try to make it without the assistance of an attorney.
    Answer Applies to: Illinois
    Replied: 4/4/2014
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