CC Charge Offs and Debt collectors

[grammush]

What is the name of your state? WA
I don't know where to begin! I have about $40,000.oo in cc debt. I ran my credit report and they have all been charged off. What exactly does this mean. I got one letter from one cc and it said that any amout over $600.oo that was charged off would be reported to the IRS and that the amount would be added to my income for tax purposes. I never received any thing from any of the cc telling me thay were charged off. And now I have different Debt Collectors and attorneys calling. What do I do? Can anybody help,Thanks

[ihatearizona]

A charge off is when your creditor "writes off" the amount you owed them as a tax deduction. They can send you a 1099 for the amount that was written off (although rare in this case) and you would have to claim the amount on the 1099 as income.

Go to [url]http://www.creditboards.com[/url] for more info on how you can clean up your credit and stop collection agency harrassment.

[grammush]

If a 1099 is filed you owe taxes and the debt is gone? When a debt is charged off can you ask the creditor for a 1099?

[ihatearizona]

Originally Posted by grammush

If a 1099 is filed you owe taxes and the debt is gone? When a debt is charged off can you ask the creditor for a 1099?

No, you still owe the money. It is likely that the debt would be sold to a collection agency once it has been charged off.

Why on earth would you want a 1099??? This means you'd have to pay taxes on the amount they charged off.

[grammush]

My cc have been charged off and have been sold to other collection agencies. (I know I'm not thinking clearly) So if they filed 1099's I would owe taxes on the debt and the debt collectors would stop?

[ihatearizona]

They're probably not going to send you a 1099. You still owe the debt.