1099-C for deceased

[terry]

Any suggestions on how to handle a 1099-C for deceased parent who died in 2000? Son(personal rep) had negotiated down credit card debt. 1099-C in deceased SS#. Son received the 1099-C for tax year 2007.

Thanks.

[Denne]

I have had the same thing come up today. My client is actually paying the house payment for her deceased mother....since she lives in the home. Her mother had much credit card debt and no assets other than the house to pay things off. The daughter got two 1099 C forms in the mail last week and they are for 2007 even though her mother passed on in 2005.... I feel the mother was and is insolvent.... I have been trying to research how to handle the same thing you are. I will post again if I find something that spells it out clearly. Let us know if you find out something too.

[terry]

I have had the same thing come up today. My client is actually paying the house payment for her deceased mother....since she lives in the home. Her mother had much credit card debt and no assets other than the house to pay things off. The daughter got two 1099 C forms in the mail last week and they are for 2007 even though her mother passed on in 2005.... I feel the mother was and is insolvent.... I have been trying to research how to handle the same thing you are. I will post again if I find something that spells it out clearly. Let us know if you find out something too.

I think my question has gotten lost in the shuffle! My client had asked if he could just include the amount on his 1040, since he was personal rep. Have not found anything further yet.

[GERALD]

Being personal rep does not mean personally liable in most circumstances. If the estate was properly administered and closed, there are no assets to go after and highly unlikely IRS would pursue. Is the amount large enough to create a tax liability, if a tax return was filed for the deceased? To be honest, I have routinely ignored 1099C's in similar situations over the years and have never had a comeback.

Gerald

[lbbwest]

I have had the same thing come up today. My client is actually paying the house payment for her deceased mother....since she lives in the home. Her mother had much credit card debt and no assets other than the house to pay things off. The daughter got two 1099 C forms in the mail last week and they are for 2007 even though her mother passed on in 2005.... I feel the mother was and is insolvent.... I have been trying to research how to handle the same thing you are. I will post again if I find something that spells it out clearly. Let us know if you find out something too.

What criteria did you use to claim the mom was insolvent if the house is still in the mom's name? IF the house has equity of $100K and the credit cards total $20K the asset (equity in the house) is used to pay the creditor's BEFORE the inheritors receive proceeds from estate. In other words your client can't claim the house until the estate balance sheet is done. lbb

[terry]

Being personal rep does not mean personally liable in most circumstances. If the estate was properly administered and closed, there are no assets to go after and highly unlikely IRS would pursue. Is the amount large enough to create a tax liability, if a tax return was filed for the deceased? To be honest, I have routinely ignored 1099C's in similar situations over the years and have never had a comeback.

Gerald

Thanks for your response! There are no remaining assets and the 1099-C is for $800.