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Collection agency has not sent 1099C.

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ferdanan56 Joined: 07 Mar 2011 Posts: 1 1.33 Dollars($)	Posted: Mon Mar 07, 2011 12:40 pm    Post subject: Collection agency has not sent 1099C. Like 0 Dislike 0 We owed 40k on house and could not make the monthly payments. Mortgage company eventually sold our debt to a collection agency. House finally sold for $5,000 in 6/10. They told us we would get a 1099-C so that we would have to claim the $35K we lost on the house as income and pay taxes on it. They have not sent the 1099-C. If they dont send it, does that mean they did not forgive the debt? Can we expect to be sued for the $35K? Do we have to claim it on our taxes, even if we do not get the 1099-C? We (and our tax preparer) don't know what to do.
smithsussane Joined: 18 Sep 2008 Posts: 10423 Location: Alaska 983.47 Dollars($)	Posted: Mon Mar 07, 2011 7:57 pm    Post subject: Like 0 Dislike 0 Hi ferdanan! Welcome to forums! The lender will send you the 1099c form only when he has forgiven the dues. You haven't received the 1099c form yet. In such a situation, there are chances that the lender will sue you for the deficient balance. As you're liable for the debts, you won't have to claim it on your taxes. Feel free to ask if you've further queries. Sussane

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