payment processors and third-party settlement organizations, including PayPal, are required to report to the IRS all credit card and similar transactions of payments to merchants on the new Form 1099-K, Merchant Card ...

Can people who are able to make the regular debt payments ... credit balances from a settlement) is considered income by the IRS. Any amount greater than $600 forgiven by a creditor will result in a 1099 tax form ...

... payment of $27.0 million for the litigation settlement. Reconciliation of ... %              Sales by Modality       Single Use  $ 5778%10%  $ 1,1099%12% Other  1,0353%7%  2,0774%9%WW ...

... payments, property liens, or even prosecution ... Assistance for Individuals (800-829-1040) and request that they fax to you all personal W-2 and 1099 forms they have on file for you for 2009. In addition,

... advice before negotiating credit card debt settlements ... tax payment options, tax liability, tax-time identity theft and manage your credit and debt at tax time. Another potential problem: receiving a 1099-C ...

... the creditor agrees to take a portion of the amount you owe and cancel it while you make smaller payments on the remaining balance. Debt settlement, however, can get you a Form 1099-C, and you'll pay taxes on ...

Can people who are able to make the regular debt payments ... credit balances from a settlement) is considered income by the IRS. Any amount greater than $600 forgiven by a creditor will result in a 1099 tax form ...

... payments, property liens, or even prosecution ... Assistance for Individuals (800-829-1040) and request that they fax to you all personal W-2 and 1099 forms they have on file for you for 2009. In addition,

... payments, property liens, or even prosecution ... Assistance for Individuals (800-829-1040) and request that they fax to you all personal W-2 and 1099 forms they have on file for you for 2009. In addition,

Can people who are able to make the regular debt payments ... credit balances from a settlement) is considered income by the IRS. Any amount greater than $600 forgiven by a creditor will result in a 1099 tax form ...

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We did a short sale on our primary residence in 2009. We had a 1st and a 2nd mortgage, we have already received our 1099-C form from our 1st mortgage but have yet to receive one from our 2nd mortgage. When we completed our short sale we agreed to a specific payoff amount that was settled before closing so there is no outstanding payments to them. Will I receive a 1099-C form from them this year or do they not need to send me one since it is a 2nd mortgage? Please note: We have signed paperwork from the second mortgage from closing stating that we owed them a settlement fee of $2500 (which we paid and we have proof of) and upon receiving that from us personally plus the payment from the 1st the paperwork states they release the lien IN ADDITION to forgiving all outstanding deficienies. So, with that paperwork in place, should we be worried that we did not receive a 1099-C or should we just file our taxes with just the one form we received from the 1st mortgage??Since the debt was forgiven, and they do owe me the form by law - if I don't get it this year, and I get it next year, will it make a difference (negatively or positively) which calendar year I report it on my taxes since it was my primary residence and we are protected under the mortgage relief act?

I received a settlement check from my old mortgage company that had my loan when I lost my house through foreclosure. At the time, I was married, but was going through a divorce. My ex-wife had paid me maybe 2 payments on the mortgage after she moved out in April of 2006. Our divorce was final in November of that year. Now, I just received the check in the mail today. Here's the issue I have; the check is made out solely to me, and the 1099 misc. tax form is in my name only. So that means, I am going to have to pay the taxes on the amount of this check, not my ex-wife. I was not aware of this until I got the check. I need to know if since I'm paying the taxes in full, and the check was made out just to me, if I'm legally entitled to keep the full amount and not have to split with my ex-wife. I need input on this ASAP please!!!

I'm trying to wrap-up my taxes and I wanted to confirm that the deadline for submittal of 1099's was January 31. I settled 4 Credit Card debts last year and have received the corresponding 1099's for two of the four. For the other two (who happen to be with the same Creditor), I received a strangely worded letter that essentially said "we're going to send you a 1099 for the year in which the settlement was completed". Since all the payments on these two settlements were made in 2009 I assumed that they were considered "completed" in 2009, but since I haven't received any 1099's on these two, it looks like they may consider it "completed" in 2010.

I received a payment under a wage and hour litigation settlement. I have lived in NC since 2007 and the tax was paid to the state of PA where I lived prior to moving. Do I need to file a state tax return for PA? Thanks.

I've been reading a lot about this because I've been trying to figure out how to go about settling my debt for much less with all my credit card companies and then just paying them off in full with the amount that's left after the settlement (they are all in collections and have been for months). What I didn't know until I started researching this, was that in some cases you do have to report this as income on your tax return. I definitely DON'T want to have to do that. So, two questions. One, what are the guidelines for being eligible to NOT have to report it? And how could I be 100% sure that I won't have to fill out a 1099? Who would I talk to professionally about this before I decide to pay the debts off, and would I have to pay for their services? I need to do something about these cards soon, whether it's pay them off or make a payment. Second, if for some reason I would have to report it on my tax return because I wasn't eligible for not having to report it, is there anyway I could pay it off in full without negotiating a settlement, but still have them lower it? What I mean is, have them possibly take off all the fees that have accrued over the past several months, but not necessarily cut it down to 30-40%, so that it won't be a settlement that will have to be reported.. so that the lump sum I pay them will be less than if I had to pay what the bills say are due right now. Also, any tips for negotiating with these people? I've never done this, only heard and read of several people who have. What do you say, how do you negotiate, how do you tell them you can "only pay X amount", etc. etc. and if I did settle in the end, how would I go about obtaining that statement that I needed to say from them that it was actually settled and paid in full? Do I make sure I get that before I pay or after?Okay, also, so regardless of whether they settle it for less than $600 or more than $600, I still have to report it as 'other income' on my return? And if the amount I settle for is LESS than $600, I just don't have to pay any taxes on that?

On Wednesday my wife got a call from a guy claiming he was from the IRS stating his name was Al Hobs. He stated that we misstated a 1099 form and therefore you owe us 5,687 in back taxes. I do contract work and we have mis-stated one before and it was not fun with penaltiess and interests. This Al Hobs was veryforce fulll andthreadingg saying he will butlienss on property and garnish wages he also noted it will cost us double what we owe. She told him that she should talk to me about it, he said its too late we have been trying to talk to him, He did offer he a payment of 4,000 and would consider this closed. She gave him her credit card to settle this. I got home and she told me about this I was confused and called the our tax guy. One the tax guy said it would take up to a week for me to review you document. Two the tax guy said they would send writtencorrespondencee to you on this, also the IRS never acts like Al Hobs and demands money right here and now. Tax guy advised that I should check my wifes credit card to see if was the IRS or a scam. Sure enought I checked my wifes cc transaction there was a payment of 4,000 to portfolio recovery associates. Well they have been contacting me on a debt way past the statue of limitations. Debt was charged off in 1999 as a Discover card for 1,987 and they inflated it to almost 6k. I called them up and talked to a supervisor very shady and he said that my wife agreed to make a settlement and we did not pretend to be the IRS. He did also state I will get a letter showing a it is settled and closed and he also laughed and said yes you will get a 1099-c form on they debt we forgave to you. so will IRS by the way. I told them I am going to fight this he said who will they belive a dead beat like you or us. I think us good luck. What can i do, can we dispute the charge ect. I am really p'd off. I see all kinds of nasty on this company Portfolio Recovery Associates how can they talk to my wife anyhow as this debt was before we were married.

I received a letter stating that they had forgiven and had to issue me a 1099-C Form. I don't completely understand it but am willing to try to understand!does this mean i will owe alot at income tax time?

My brother had a credit card with a $500 limit. He charged up the $500 and then defaulted on the payments. This was over a year ago and the card balance with interest and fees is up to $1500.00. He called to make a settlement with the credit card co. and they said they would settle for $500, the initial amount of his purchases. Then they told him that he would get a 1099 tax form at the end of the year and he would have to pay taxes on the $1000.00 they wrote off in the settlement. Is this right? I have never heard of this before?

I received a very good settlement offer for an account I have in collections. I have the money and would like to pay. However, the wording on THEIR letter to me is as follows: Our agency is authorized to settle your account for a reduced amount of XXX. Isn’t it supposed to say something regarding once payment is received that they consider the account to be paid in full? Or something along those lines? I don’t want to screw myself here. Also, I do have to claim this on my taxes (next year) as a 1099 right? And it just counts as “income”? Any advice is appreciated!I’ll have to check on it against my credit report. But if it’s charged off, there’s no sense in paying?? Because I did have some accounts that were charged off. I just don’t know if this is one of them.

I had a case that was settled, (overtime and workman's comp) back in Jan of 08 I was out of state and my settlement check got cashed by my lawyer with out my consent. now so there is no confusion the check was clear of owing anyone (court, fee's etc...) the company I sued had to pay all the cost of the lawsuit. my lawyer was sent a separate check for his fees from the company I sued. this check he cashed was in my name and address, he deposited the check in his checking acct he signed my name to it and didn'tnt and never would have known about the check had I not been sent a 1099 from the company that sent the check. is there anything I can do? and also on the workman's comp part of the case I was sent a check in my name at my home and my lawyer got his payment separate from mine (the comp took out his part) now I have already gone to the police and told them the story. and no paper form report was filed or given to me. what can I do about this?

I have around 50,000 dollars in credit card debt. I make 40k a year, and I may end up getting fired. I barely make enough now to pay all my bills. I am maxed out on all my credit cards, but I have been making all of my payments on time, by using my other credit cards. So my credit score is good right now, but unfortunately I have reached my breaking point. Starting next month, I will not be able to make all my payments and will start going into delinquency on my accounts. I know to settle I have to have delinquencies. Should I wait a few more months for my credit to go bad and then reach out to a settlement company? Should I try and file for bankruptcy? I have reached my limit and now realize that no matter what I do, my credit is going to suffer. I just want the best option to get out of debt as quick as possible, I realize the consequences for my credit will be horrible, and know it will take a long time to get back into good standing, but I need a solution asap to get me into a situation where I can afford my monthly payments. If I lose my job I'll be in a worse situation then I already am in, if that's the case should I file for bankruptcy? If i don't lose my job should I settle? Will I have to wait for a few months till I go into stages of delinquency? And if I do settle for half of my debt, going from my full 50k that I owe to now only owing 25k, how much would I have to pay back in taxes on the 1099? Please help me, I have reached the point where I can no longer make my payments, what should I do? Thank you in advance for your advice, it's much appreciated.

I closed on a condo in September 2008. Both the closing lawyer and RE agent tell me that there are things that I could put on my 2008 taxes to increase my return. The one issue is, I'm going through this thing on HR Block and TaxSlayer but can not find a place to put any of the things that are on the HUD-1. The only thing they ask about are things that are on the paper that the bank sent to me (1098 or 1099 form. Don't remember). That form only lists interest, taxes and PMI for 2 months. None of the money that went to escrow is on there. I know I paid 4 months of taxes in all. Anyway... of the things on the HUD-1, what can I list (and where) on the tax forms? I have city/property taxes, down payment, bank costs, other settlement costs. I paid about $10,000 for all of those but the 1098 paper on has the two month interest and two month of taxes. Any thoughts?

I have a question. I just negotiated a settlement with a credit card company, the agreement was at 30% of the existing debt. They agreed that a one time payment would "pay the account in full". So today I call back to have them fax me a letter to that effect, and my account manager's "partner" answers the phone, goes into my file and agrees to prepare the letter ....but THEN she informs me that at the end of the year the company will be sending me a 1099 for the unpaid protion of the account. (I'm assuming she means the amount I negotiated away) I have never heard of such a thing. I'm not agreeing to the settlement if that's a contingency. The agreement was "30% paid in full", not "30% and we'll tax you on the rest". Does anyone have any factual insight on this? Or personal experience?The debt is only about two years old and I was paying regularly until May of this year. I understand why they want to do the 1099 but...I've had settlements before and have never had this done... Could it be because it was a significan amount? Or are they just desperate for some revenue?This is with "collection company" only I know that they are a collection company owned and run by the original creditor.The "Forgiven" amount is about $3700...seems odd that one of the only banks left standing in today's financial market, would bother....but this may be why they are one of the survivors. Thanks guys...I'm going to call again and talk to the original lady that made the deal and if she doesn't back off, I'll just take my lumps...lol Thanks again.

I have been ripped off by a credit card system & need to know which Agency is a watch dog for credit card abuse of consumers. I paid off a defaulted credit card debt of $50,876 in 2007. The credit card co. accepted $26,000 as a settlement for full & final payment. At the end of the year they sent me a 1099 showing a debt discharge of $60,268 to add to my income tax filing. When I inquired they told me once you default on a credit card they raise the interest to 29% + a monthly fee of $78. This gives them a much higher debt loss reimbursement from their insurance co. The bank WINS BIG TIME, IRS WINS BIG TIME & the DEBTER get the screw job owing more than the original debt. Who can help me find a consumer agency that will help me do battle with the BANK OF AMERICA. Need some help to a small consumer under water from debt. JK

A roofing company performed services on the roof of a property I own without my consent in order to get a rebate from the state electric company energy incentive program.A contract was issued & fraudulently signed by the contractor salesman and my tenants.This voided the warranty on my roof. I contacted the roofing company and they agreed to replace the roof, and I opted for a settlement for damages caused,equivalent to their cost of replacing the roof.They have given me a check for the agreed settled amount but requested that I sign a W9 in order to send me a 1099 next year. I have a problem with this as this is not income to me, but rather compensation for damages caused by their negligence for performing unauthorized services on my property.They insist they will file a 1099 and I am telling them I should not pay taxes for their damages. I have everything well documented and the backup from the Pwr/Light Co.HELP,what can I do what are my rights...I have not cashed the check.HELP HELPMoB.....thanks for your answer. This was a mutual settlement out of court. Contractor did not want me to report him and offered to replace the roof, but since I had roofed the house (with another roofer 13 months prior) the roof was new...red shingles and they applied a white sealant over the new shingles that is not reversible, I requested a settlement for damages caused.Contractor paid what he said would cost him to re-roof so I am certain he would not have given me a W9 should I have reroofed. He received money from FPL from the energy program, and now he wants to benefit as an expense to me? Something is wrong here? If later on something happens to my roof, I will not be able to replace it for the amount he is paying since that is his cost but a fair settlement between us, and he has voided the warranty I had only 13 months before. I have the check and I want to stop this so it can be clarified. Can you offer more help.....please. I should have gone to court on this but nice me??

Report on Form 1099-MISC only when payments are made in the course of your trade or business. ... with legal services, for example, as in a settlement agreement, unless the ...

Payor shall issue form 1099 to an attorney for: Amounts for legal services; Amounts for settlement payments and legal services where attorney is joint payee or ...

The Instructions for Forms 1099, 1098, 5498 and W-2G provides instructions on the items to be reported. In lawsuit settlements, the person with the obligation to report payments ...

Discussion Forum Index--> Tax Questions--> 1099-MISC for out of court settlement award ... However, I know that payments for property damage injuries are not exclude ...

Free collaborative tax resource and research community created by tax pros for tax professionals and academia. Brought to you by Intuit and based on Wiki technology.

Do I have to report legal settlement payments to IRS if I receive a 1099 from ... new state of your property and pocket the settlement then it becomes taxable in full. While a 1099 ...

1099 Settlement ... Are your credit card payments more than you can afford to pay each month?

Taxes on a 1099 for a lawsuit settlement - What is the percent used for taxes on 1099 for a lawsuit settlment?

Understanding many sole proprietors are under the gun to follow up on the extensions they filed this past April 15, TaxMasters, Inc. , the IRS tax relief company and a leading provider of tax representation services, is sharing the ultimate 6-week plan designed to walk small businesses through the steps they need to meet the IRS' October 15 deadline.

Q . This is regarding when negotiations take place in paying off creditors when they accept pennies on the dollar just so they'll receive something on the account. Can people who are able to make the regular debt payments do that? Will any of creditors accept an offer for, let's say, $3,000 to close that $5,000 account? Yes, part of me thinks it's a stupid question, but I also think that these ...

This is regarding when negotiations take place in paying off creditors when they accept pennies on the dollar just so they’ll receive something on the account. Can people who are able to make the regular debt payments do that? Will any of creditors accept an offer for, let’s say, $3,000 to close that $5,000 account? Yes, part of me thinks it’s a stupid question, but I also think that these days ...

Dear Debt Adviser,

Before you offer to pay pennies on the dollar to a creditor, be aware of how it harms your credit.