Discussion:Hard Times

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P.S. The woman is a very nice woman and I probably made a mistake when I called her "Stupid" during our meeting earlier today.  So, if there's any way to make this whole thing work out for her - wholly, or partially, or in any way - so Ck looks stupid, I'd be willing to bite the bullet on this one.}}
P.S. The woman is a very nice woman and I probably made a mistake when I called her "Stupid" during our meeting earlier today.  So, if there's any way to make this whole thing work out for her - wholly, or partially, or in any way - so Ck looks stupid, I'd be willing to bite the bullet on this one.}}
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{{ForumReplyPost|UserID=Kevinh5|Date=21 April 2014|Text=claim of right?}}

Revision as of 16:28, 21 April 2014

Discussion Forum Index --> Advanced Tax Questions --> Hard Times


Discussion Forum Index --> Tax Questions --> Hard Times

Ckenefick (talk|edits) said:

21 April 2014
A while back, taxpayer fell on hard times and was unable to pay a bunch of her liabilities, including some personal credit card debt. She stopped making payments to the credit card company, and, eventually, the credit card company issued a 1099-C (for tax year 2009). The woman never negotiated with the credit card company, hired an attorney, etc. In any event, she went ahead and reported the COD amount on her 2009 self-prepared 1040 and paid tax on it, with what little money she had.

At the end of 2013, she got a call from a collection agency that was trying to collect on the old credit card debt. Without consulting an attorney, or anyone else, she went ahead and paid it, in 2013. (She received an inheritance in mid-2013 and that's how she came up with the money to pay it).

The woman extended her 2013 return and was recently referred to me by a client. I met with her this morning and that's how I learned of all of this stuff.

So, I'm wondering how to handle this repayment on her 2013 Form 1040. Please advise.

P.S. The woman is a very nice woman and I probably made a mistake when I called her "Stupid" during our meeting earlier today. So, if there's any way to make this whole thing work out for her - wholly, or partially, or in any way - so Ck looks stupid, I'd be willing to bite the bullet on this one.

Kevinh5 (talk|edits) said:

21 April 2014
claim of right?
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