1099C tax?

Question

Person doesnt pay his bill of $1100 for a bill owed to a doctor. Can this person get a 1099C without knowing there social security number? Is there such a tax? What exactly is a 1099C anyway?

Answer 1

A 1099-C is a form for reporting canceled debt.  If a person owes money and does not pay, and the person to whom the money is owed cancels the debt, then the person who cancels the debt must send a 1099-C form to the person who previously owed the debt, and the person who previously owed the debt must pay income tax on the amount of debt that was canceled.

Answer 2

a creditor would cancel a debt so they can write it off as a loss and get a little deduction on their taxes.

This is only done when the creditor sees no chance of ever collecting.  at least he gets a deduction.

Answer 3

A 1099C is for cancellation of debt.  The amount is taxable income to you.

Answer 4

It makes no sense to cancel a debt without participation of the debtor by partial payment in exchange for forgiveness of the rest.  A canceled debt is an unenforceable debt--if you won $1 Million in the lottery tomorrow, the creditor could not come after you.  Why cancel it when there is a chance, however small, that there could be some recovery.

Answer 5

A 1099C is for cancellation of debt.  In this case, there is probably enough question that the debt actually exists that the 1099C is improper.