Tax

Have a Tax Question? Ask a Tax Expert

Ask an Expert,
Get an Answer ASAP!

Tax

We have a car that is out for repossession. I am trying to

Customer Question
find out it there is...
We have a car that is out for repossession. I am trying to find out it there is anything I can do before they take it to see if they will waive the amount owed after auction. I know it will be considered income on taxes, and bankruptcy is not an option. I am not sure what it is called or what to ask for exactly, we are in NC, car bought in VA
JA: What sort of protection is being sought? What are the debts in question?
Customer: We owe about $24k on it, we think it will be sold for auction at $10-15K. We are trying to voluntarily surrender it and have the $9-14K not be sought after.
JA: Has anything been filed or reported?
Customer: Toyota Finance says it has been charged off, and is out for repossession. They do not have the car, we have the car.
JA: Anything else you want the lawyer to know before I connect you?
Customer: I do not think so.
Submitted: 4 months ago.Category: Tax
Show More
Show Less
Ask Your Own Tax Question
Answered in 54 minutes by:
7/26/2017
Tax Professional: PDtax, Certified Public Accountant (CPA) replied 4 months ago
PDtax
PDtax, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 4,714
Experience: 35 years tax experience, including four years at a Big 4 firm.
Verified

Hi from Just Answer. I'mCustomer and can assist.

Ask Your Own Tax Question
Tax Professional: PDtax, Certified Public Accountant (CPA) replied 4 months ago

Negotiating this kind of relief is difficult unless your financial condition supports your request. There may be tax relief available even if Toyota Finance issues you the 1099-C. Let's start there.

If you are insolvent (debts exceeding assets), the debt forgiveness income may not be taxable. Your financial condition, and completing Form 982 with your tax pro, will be a good first step. If you qualify for nonrecognition of the income, let Toyota send you the form. You're covered.

If this won't work for you, you may have some things working in your favor. Since you have moved, you might be difficult for the repo man to find. Offering to turn in the car voluntarily might be a negotiating tool you can use to negotiate, especially if the creditor does not know where the vehicle is. You might offer to deliver the vehicle in its best condition to them in exchange for whatever concessions you wish for. I have seen specific language used between a debtor and creditor in which they agree in writing not to issue the form, and you agree to certain things in consideration.

I have seen numerous examples of debtors asking for this release, and the creditor's debt collector agreeing over the phone. But, in January, when the 1099-C comes, and the debtor finds that promise to not be binding, that the 982 relief options must be considered. And after the fact is never as good as before.

Keep in mind that you are negotiating with a creditor, and any promises made by either of you should be committed to writing and agreed to by both parties. Debt collectors can and will make promises they have no burden to keep, and collection laws vary by state.

There is a very good case that may be binding in your IRS District. The recent Sixth Circuit case of McClusky v. Century Bank, FSB, 2015 U.S. App. LEXIS 1419 (2015) concerns the consequences of failing to consider possible tax issues, and provides an excellent summary of the law applicable to the settlement of a dispute involving the cancellation or discharge of an indebtedness. In McClusky, debtors sued after receiving 1099-C after having a written settlement agreement.

I suggest that you consider having an attorney assist in the negotiations, and in drafting the agreement that would be binding in your District, with terms similar to McClusky.

Thanks for asking at Just Answer. Please take a moment to post positive feedback on our five star rating scale. Experts are not compensated until your positive feedback releases their fee.

Customer/p>
Ask Your Own Tax Question
Tax Professional: PDtax, Certified Public Accountant (CPA) replied 3 months ago

Can i ask for positive feedback to complete your request for month end?

Customer/p>
Ask Your Own Tax Question
Ask PDtax Your Own Question
PDtax
PDtax
PDtax, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 4,714
4,714 Satisfied Customers
Experience: 35 years tax experience, including four years at a Big 4 firm.

PDtax is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Wallstreet Esq.

Wallstreet Esq.

Tax Attorney

586 satisfied customers

10 years experience

Mark D

Mark D

Enrolled Agent

1,300 satisfied customers

MBA, EA, Specializing in Business and Individual Tax Returns and Issues

Richard

Richard

Tax Attorney

4,310 satisfied customers

29 years of experience as a tax, real estate, and business attorney.

Robin D.

Robin D.

Senior Tax Advisor 4

13,695 satisfied customers

15years with H & R Block. Divisional leader, Instructor

Megan C

Megan C

Certified Public Accountant (CPA)

8,651 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

jgordosea

jgordosea

Enrolled Agent

2,885 satisfied customers

I've prepared all types of taxes since 1987.

R. Klein, EA

R. Klein, EA

Enrolled Agent

1,839 satisfied customers

Over 20 Years experience

< Previous | Next >

Related Tax Questions
Am I on the right path to decreasing my tax burden on the
Am I on the right path to decreasing my tax burden on the income made in commission for unpaid quarterly taxes?The break down is the following for me and frank :so far Eric nurse w-2 full-time earning… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
I received a letter from the IRS stating that I owed taxes
I received a letter from the IRS stating that I owed taxes on money that I did not claim for 2015. However, I did claim it. They are counting it twice. I submitted all evidence that I have to the IRS,… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,483 satisfied customers
Are you familiar with income tax laws on business and
Are you familiar with income tax laws on business and personal returns? … read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
Dose mean can not deduct state income taxes only or dose it
dose mean can not deduct state income taxes only or dose it includes property taxes too … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
What are tax implications when docating small IRS to state
What are tax implications when docating small IRS to state university … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
Form 1120, cash basis. If Taxes paid to IRS are deductible,
Form 1120, cash basis. If Taxes paid to IRS are deductible, are refunds for overpayment the equivalent of income?… read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
736 satisfied customers
Is real estate income taxed only in the state they are
Hi. Is real estate income taxed only in the state they are generated in? For example, if someone owned investment real estate in Texas that has a 0% state income tax and lives in Pennsylvania, would t… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,695 satisfied customers
The IRS has sent my back tax debt to a collection agency.
The IRS has sent my back tax debt to a collection agency. When i call the debt collectors am I still negotiating with the irs or them?… read more
abci168
abci168
Principal
27 satisfied customers
What is the purpose of irs form 2297. by signing this form,
what is the purpose of irs form 2297. by signing this form , am i giving up my right to my past refund? … read more
abci168
abci168
Principal
27 satisfied customers
NYS can collect personal income tax for 20 years? But the
Hi - So NYS can collect personal income tax for 20 years? But the Fed can only collect for 10? … read more
abci168
abci168
Principal
27 satisfied customers
Can the IRS seize my assets for neither having health
Second opinion] Can the IRS seize my assets for neither having health insurance or paying the penalties.… read more
emc011075
emc011075
Senior Tax Specialist
Bachelor's Degree
16 satisfied customers
Can the IRS seize my assets for neither having health
Can the IRS seize my assets for neither having health insurance or paying the penalties. … read more
abci168
abci168
Principal
27 satisfied customers
An S Corporation is selling its assets under an Asset
An S Corporation is selling its assets under an Asset Purchase Agreement. The 2 stockholders materially participate in the operation of the business. The business provides credit card processing softw… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
Tax law Employer provide rent for out-state employee, and
tax law Employer provide rent for out-state employee, and the employee should be able to exclude the value of the lodging from gross income. If we have the contract to stated that the employee must be… read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
This is a question about state income taxes between IL and
This is a question about state income taxes between IL and WI. Earlier this year, my wife and I were living in WI, I worked for a WI employer and she worked for an IL employer. We filed state taxes in… read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
736 satisfied customers
I have filed bankruptcy on my discharge they have IRS ace
I have filed bankruptcy on my discharge they have IRS ace support stop5050 what does … read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,483 satisfied customers
I received a notice from a law firm that collects delinquent
Good morning. I received a notice from a law firm that collects delinquent school district real estate taxes. My tax bill for 2016 was delinquent. It stated the full amount must be received in their o… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
Chad! On the note of collections from IRS ... Let's say they
Hi Chad !On the note of collections from IRS ...Let's say they avoid putting a lien on our investment property because child supp is being paid from it so they'd have to get in a long line before they… read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
736 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x