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The Curious Bag
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Form 1099-C is the cancellation-of-debt form used by the Internal Revenue Service (IRS). If creditors cancel a debt that is more than a certain amount of money, they must report that information on their taxes.
Threshold
Creditors must use Form 1099-C to report any canceled debt that is $600 or more. These creditors may include banks, credit unions, trust companies, building and loan associations, and savings and loan associations.
Multiple Debts
If creditors have canceled multiple debts of $600 or more, a separate Form 1099-C must be filed for each.
Information
On the form, there is a section where the creditor's information needs to be filled in. The phone number needs to be on the form.
Identity Theft
If a person is a victim of identity theft, creditors don't need to report a canceled debt that resulted from fraud.
Conditions
Even if the person for whom a debt was canceled won't be filing a tax return, creditors still must file Form 1099-C.
Source:
IRS.gov: Instructions for Forms 1099-A and 1099-C
Resource:
IRS.gov: 2009 Form 1099-C
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