Charge Off On Credit Report
There is a post on another board I read saying that if it is noted as a charge off on your credit report instead of as included in bankruptcy, that you can expect to get a 1099 from the creditor. Is this true?
Answer:
If there is a settlement involved they can send you a 1099. They settled for less than the payoff. It varies from state to state. Perhaps Brett can advise us. My understanding is that a charge off occurs because they cannot settle and some times cannot find you. They cannot send you a 1099. There is no agreement. As a realtor, I cannot send a 1099 to a tenant that skipped. If you survive through the phone calls, change your phone number, and they decide not to attach a lien or otherwise cannot touch you, it results in a charge off. What we see with Household International is the judge rules on a chapter 7. Then Household petitions for it to go as a chapter 13. Regardless of what the judge says, Household shows it as a chapter 13. Then they go after you, in essence saying "screw your ruling" to the judge. (Check Google search for cases) It then stays as a chapter 13 on the consumer's credit report. (Household International has the credit reporting authority) There was no 1099, no judges ruling, and no chapter 13. They can. If you're insolvent, however, there is no imputed income and no taxes due.
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