Credit Card "canceled debt" ?

[sdaughter]

Ohio
I just received a "tax paper" from a credit card company for my deceased mom...it say canceled debt and the amount. Does that mean its over and they are taking it as a loss?

[Some Random Guy]

If the "tax paper" is a 1099-C, then the credit card company is writing off the debt as uncollectible. Because your mom's estate is releived of paying this debt, it is considered income by the IRS.

When filling out the final tax return for your mother, you should research the IRS publications on this since you can avoid paying taxes on this income if your mom's estate was insolvent. I would suggest using a professional tax preparer for your mother's final return to ensure that you have not missed anything.

[sdaughter]

My mom died in 2005...that year while she was alive was the last tax forms ever done. I don't have anything, paperwork,etc. Everything was tossed out. She never had to pay anything. She got a government military pension. I never received anything or forms.
It's nice to know they are writing it off she didn't have anything. She owed a little over four thousand dollars on the card.

Thanks for your quick answer.

[seniorjudge]

I wouldn't worry about it then.

[sdaughter]

Thank you...its good to see an end in sight with this situation.