Thank you for using justanswer. Section 6502(a)(1) of the tax code limits the time IRS can collect or levy tax to 10 years after the date of assessment
. (See also Tax Code section(NNN) NNN-NNNN1) Court proceedings must also be started the the IRS within that 10 year Statute of limitations.
The statute of limitations for the state of Maine (if that's the state that would have been involved back in 1999) audits is 3 years from the later of the due date
or the file date of the tax return. If income understated by more than 50%, statute of limitations is 6 years.
In both cases it appears that the statute of limitations has passed, and you have every right to dispute this 1099C.
You need to send a letter to the issuer of the 1099C via Certified Mail + Return Receipt (NOT regular mail) stating:
Per the Fair Debt Collection Practices Act, I dispute your claim that I entered into any settlement agreement that involves a forgiveness of debt that would necessitate my filing a 1099-C. I will not file any 1099-C form until you provide written documentation that I entered into any such agreement, to include:
- a copy of a written agreement with my signature where I agreed to settle with your firm that involves a forgiveness of debt that would require my filing a 1099-C
- a copy of the canceled check for any alleged payment by me
Per the Fair Debt Collection Practices Act, I am requesting written validation of this alleged debt, including a copy of the original signed application with my signature
* Do not sign your signature on any document that you mail to a debt collector. It could end up on a forged document that can be used against you. Simply type your full name.
If you get any notice from the IRS regarding this 1099C, send a letter to them stating that you did not enter into any settlement agreement that involves a forgiveness of debt and that a 1099-C will not be filed until proof is provided about any alleged settlement.
I hope this helps.