What Happens If 1099-C Is Not Filed?
Avoid Paying Taxes On That 1099 Form, Legally. It’s tax time and the mails are full of IRS form 1099. If you managed a short sale of your property; suffered a foreclosure; filed bankruptcy; or settled your debt for less than you owed, you probably got a 1099.
Do you have to file Form 982 if you get a 1099?
To establish your right to exclude the money shown on the 1099, you have to file IRS form 982. If you don’t file the form and claim the exception, the IRS has no way to know that, despite the debt forgiveness, there is no tax payable. Form 982 lays out the possible reasons forgiven debt might not be taxable.
