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I just received a 1099-C Cancellation of Debt from Wells…

Hello, I just received...

Hello, I just received a 1099-C Cancellation of Debt from Wells Fargo, credit card but the Taxpayer ID number is ***** Father's SS#. Also, it's to the Estate of. Am I liable even if I, his daughter, my name was not the beneficiary on his card?

Accountant's Assistant: The Accountant will know how to help. Is there anything else the Accountant should be aware of?

Not that I know of. Thank you, Annie

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Answered in 3 minutes by:
3/3/2017
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 32,839
Experience: Taxes, Immigration, Labor Relations
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You are NOT liable for that COD income (cancellation of debt income) as it is related to your father.

However - that is reported on your father's FINAL tax return if form 1099C is issued for the year he passed away OR on the estate tax return form 1041.

You may also claim insolvency exemption (if qualify) and exclude that income from gross income.

Let me know if you need any help with reporting.

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Customer reply replied 1 year ago
Thank you, ***** ***** gave me hope. Although, it stated, date of identifiable event was 10/01/16. My father deceased 2008.

Then - you likely had all estate dissolved long ago.

In this case - I might suggest not to file the estate tax return for 2016 just because of that form.

Instead - just send a letter to the IRS with explanation of facts.

Mention that is long time outstanding debt that you were not aware

and the debtor (your father) passed away in 2008.

Attach a copy of the death certificate and a copy of that form.

Chances are - you will never hear from the IRS about that reporting.

But in any case - do NOT include this form with YOUR tax return.

Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 32,839
Experience: Taxes, Immigration, Labor Relations
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