1099-C Question

[CSM912]

My wife settled four credit cards all from the same bank for less than each card was owed (less than $300 debt forgiven for each), and all accounts are now resolved.

My question is that since each individual credit card had less than $300 of debt forgiven, will she NOT receive any Forms 1099-C since each account debt forgiven was less than the $600 requirement for issuing a 1099-C, or should she expect to receive a 1099-C since all four cards combined debt forgiven was more than $600 from the same bank?

[DawnC]

You should check with the bank to be sure, but she probably will not be receiving any 1099-Cs.   From the 1099-C instructions:  Do not combine multiple cancellations of a debt to determine whether you meet the $600 reporting requirement unless the separate cancellations are under a plan to evade the Form 1099-C requirements.   

More information on Cancelled Debt can be found in that link.