topic Re: 1099c in After you file

1099c

Ammz5 — Thu, 03 Feb 2022 20:34:44 GMT

I filed my taxes a week ago, and today received a 1099c for 3,000. I completely forgot this was coming and know I cannot amend yet. Will this affect my taxes in a big way? I have never had this happen before and nervous I may owe a ton. It does not put me into a higher tax bracket either.

Re: 1099c

Bsch4477 — Thu, 03 Feb 2022 20:43:18 GMT

Assuming it is for credit card debt the amount will be taxed at your marginal tax rate. Do not amend until your return has been processed and any tax liability settled. Amended returns can take more than 6 months to process.

Re: 1099c

MinhT1 — Thu, 03 Feb 2022 20:49:26 GMT

This form 1099-C reports a debt cancellation which is taxable.

When you amend you will owe more tax which is calculated at your marginal rate. For example, if you are at the 22% tax bracket, the additional tax would be $3,000 x 22% = $660.

Re: 1099c

Ammz5 — Thu, 03 Feb 2022 20:50:08 GMT

Thank you. Is it possible the irs will catch it before i get my refund and fix it?

Re: 1099c

Ammz5 — Thu, 03 Feb 2022 20:52:57 GMT

@MinhT1

So 3,000 at my marginal tax rate of 12% would put me owing 360 in?

Re: 1099c

MinhT1 — Thu, 03 Feb 2022 21:05:16 GMT

Yes, you are correct.

Re: 1099c

Ammz5 — Thu, 03 Feb 2022 21:18:38 GMT

@MinhT1 thank you so much for your help!