Wife got a 1099c yesterday for a repo from over 12 years ago.

[dub]

I filed Chapter 7 for just myself, not including my wife, in October. Had my 341 last month. Was getting our tax info together yesterday....waiting on the 1098 for interest paid on our mortgage to come in the mail. Was surprised when we also got a 1099c from Ford Motor Credit in the amount of $4400 for a car she let go back over 12 years ago before we met. Am I correct in understanding since this was not included in MY bankruptcy, that we will have to add this to our income for the year for tax purposes?

[moneyblues]

That's 12 years old and is no longer a valid debt. According to my understanding of credit, this is way too old and well out of SOL to be taken seriously in any state. I would make a copy of it and write on it with a red marker "Wrong time, Wrong person, Wrong debt. I have no business with you. I owe you nothing." Debts have a 7 years collection limit and if they don't get it in that time span... well...sorry for them. Game over.

[99lawdog99]

Most state have sol when it comes to debt. it is usually a few years normally no more than 6 but each state is different. Most people don't realize that if you make a payment or reaffirm a debt the sol begins to run again. In NC - Contract and sale of personal property under seal: 10 years.
12 years seems unreasonable

[daylate]

I don't have any idea why they did this but since they did it also got reported to the IRS and if you don't report it you'll probably trigger a flag of some sort. I'd check with a CPA for some tax advice.

[dub]

Thanks for the replies. I have left a message for the CPA today.

[tcreegan]

Hi all,

WTF? twelve years is a long time, FMC must have been clearing out some old files.

The statute of limitations usually refers to a collection effort. A 1099-C is not a collection attempt, it's an accounting measure on the lenders part. (in fact the expiration of the s.o.l. is one of the 'triggers' that can cause the issue of a 1099-C)

You don't need to include it as income if you are insolvent, I think the form to use is 982. You can be insolvent w/o filing for bankruptcy.

Good luck with it, your CPA should know the ropes...

Tom in Colo

Tom in Colo