Can't reach IRS? Claimyr calls for you, so you don't have to wait on hold.
Claimyr is a pay-as-you-go service. We do not charge a recurring subscription.
Using Claimyr will:
- Connect you to a human agent at the IRS
- Skip the long phone menu
- Call the correct department
- Redial until on hold
- Forward a call to your phone with reduced hold time
- Give you free callbacks if the IRS drops your call
Ask the community...
- DO post questions about your issues.
- DO answer questions and support each other.
- DO post tips & tricks to help folks.
- DO NOT post call problems here - there is a support tab at the top for that :)
Join the conversation
Join the conversation
One thing nobody's mentioned is that the 1099-C might also include interest that was forgiven, not just principal. Box 3 on the form should show the interest if any was included. This matters because forgiven interest might be treated differently than forgiven principal for tax purposes.
Actually that's a good point! In some cases, if the interest would have been deductible (like for some business loans), the canceled interest might not be taxable. Always worth checking the breakdown.
This is a really tough situation, and I feel for you having to deal with this unexpected tax burden. A few important things to consider: First, you absolutely need to report the 1099-C on your tax return - the IRS has a copy too, so ignoring it isn't an option. However, you may qualify for exclusions that could reduce or eliminate the tax impact. Since you mentioned you're already struggling with bills, definitely look into the insolvency exclusion that others have mentioned. Given that you co-signed in 2019 and your brother lost his job, it sounds like your financial situation may have been difficult when the debt was actually canceled. You'll need to calculate your total assets vs. total debts at the time of cancellation (not now). Regarding your brother - he may or may not have received a 1099-C depending on how the lender handled it. Sometimes they only send it to the primary borrower or co-signer they have the best contact info for. I'd strongly recommend consulting with a tax professional if possible, especially given the amount involved ($12,750). Many offer free consultations and can help you determine if you qualify for any exclusions. Don't let this sit until the last minute - you have options, but you need to explore them properly.
@Keisha Brown Great questions! Regarding retirement accounts for insolvency calculations - this is actually a complex area where even tax professionals sometimes disagree. The general rule is that assets you can t'easily access like (401k funds that would trigger penalties may) not need to be counted at their full value, but there s'no clear IRS guidance on exactly how to handle them. Some practitioners exclude them entirely, others include them at a discounted value. Given this ambiguity, definitely document whatever approach you take. For tax professionals, look for an Enrolled Agent EA (or) CPA who specifically mentions experience with debt forgiveness and 1099-C issues. EAs are federally licensed tax practitioners who can represent you before the IRS if needed. Many CPAs also specialize in tax preparation and have extensive experience with these situations. During your consultation, ask them specifically about their experience with insolvency exclusions and Form 982 - you want someone who s'handled these cases before, not someone who will be learning alongside you. Given the amounts involved for both you and @Natasha Volkov, professional guidance could save you much more than it costs.
Great question about retirement accounts! There's actually some gray area here in tax law. Generally, retirement accounts like 401(k)s and IRAs are included as assets for insolvency calculations, but some tax professionals argue they shouldn't count if they're protected from creditors under state law. The safest approach is to include them but note the discrepancy - you might want to calculate insolvency both ways to see if it affects your outcome. For finding a tax professional, look for someone who is an Enrolled Agent (EA), Certified Public Accountant (CPA), or attorney who specifically mentions experience with debt forgiveness issues. EAs are licensed by the IRS and specialize in tax matters. Many CPAs have broad experience but you want someone who's dealt with 1099-C situations before. Don't hesitate to ask about their experience with insolvency exclusions during your consultation. Also, since you mentioned this involves student loans your parents co-signed, be aware that there might be additional considerations depending on whether the loans were federal or private, and whether any discharge was due to disability or other qualifying circumstances.
Join the conversation
Some companies are just terrible about getting 1099s out on time. Last year I had a client who didn't send mine until March despite multiple reminders! What I ended up doing was creating a really detailed spreadsheet of all the invoices and payments, then filed with that info. The 1099 finally showed up later and the numbers matched my records exactly. If you know how much you earned from them, you can still file your taxes without waiting. As long as you report the income accurately, you're meeting your obligation. The 1099 is more about the IRS tracking that companies are properly reporting payments than it is about you proving your income.
That makes sense, but wouldn't you need the 1099 to have their tax ID number? Or is that not really necessary when you're filing?
Great question! You actually don't need their tax ID number to report self-employment income on your Schedule C. You'll list your income in total rather than breaking it down by each payer. The tax ID number is more important for the company issuing the 1099 for their reporting requirements. If you're dealing with 1099-MISC or 1099-NEC forms, you'd typically just report the total income on your Schedule C without needing to list each company's ID. Now, if you're dealing with other types of 1099s like interest or dividends, those might require more specific reporting. But for standard freelance/contractor work, you're good to go with just accurately reporting the amount you earned.
This happened to me last year with a new client! The company was a startup and their finance person had no idea about the January 31 deadline 🤦♀️ I ended up filing Form 4852 (substitute for missing W-2/1099) with my tax return. You basically create your own substitute based on your records.
Is there any downside to filing that substitute form? Like does it trigger an audit or anything?
Filing Form 4852 doesn't automatically trigger an audit, but it does flag your return for potential review since you're essentially telling the IRS "I should have received this form but didn't." The key is having solid documentation to back up your substitute form - keep all your invoices, payment records, bank statements, etc. The IRS is generally understanding about this situation since they know some employers/clients are bad about sending forms on time. As long as you're reporting the correct income amounts and have records to prove it, you're in good shape. I've filed Form 4852 twice over the years and never had any issues, but I always made sure my paperwork was bulletproof just in case.
Join the conversation
Has anyone here actually successfully dissolved an LLC without hiring a lawyer? I'm trying to figure out if I can handle this myself or if I should just pay someone to take care of it. My LLC (also did nothing) is registered in Florida if that helps.
I dissolved my LLC in Florida last year without a lawyer. It was pretty straightforward - just filed the Articles of Dissolution form (search for form "LLC Dissolution" on sunbiz.org) and paid the $25 fee. Make sure your annual report is filed first and that you don't have any outstanding tax obligations. The whole process took maybe 20 minutes online plus a few weeks of processing time.
Great advice from everyone here! Just wanted to add that if you're feeling overwhelmed by all the different requirements (federal, state, dissolution procedures), don't forget that the IRS also has some helpful resources on their website. Publication 3402 specifically covers tax issues for LLCs, including inactive ones. Also, make sure to keep good records of everything you do to close the LLC - the dissolution paperwork, any final tax filings, correspondence with state agencies, etc. This documentation will be valuable if any questions come up later. I learned this the hard way when I had to reconstruct paperwork for an old business years later. One last tip: if you formed the LLC late in the year and it truly had zero activity, some tax preparers recommend including a statement with your return explaining the situation (like "LLC formed in December 2023, no business activity conducted"). It's not required but can help prevent any confusion if the IRS has questions.
Join the conversation
Hey OP, any updates? Did you manage to get through to anyone?
Not yet, but I'm gonna try calling first thing tomorrow morning. I'll keep you guys posted!
This is super frustrating! I had a similar issue last year where my transcript showed a deposit date but the money didn't hit my account for another week. Turns out there was a processing delay on the IRS side that wasn't reflected in the system. The key thing is to keep checking your transcript for any new codes that might pop up. If you see a 571 or 570 code appear after the 846, that means there's a hold. Also, double-check that your direct deposit info matches EXACTLY what you have on file with your bank - sometimes even extra spaces can cause issues. Hang in there, it'll come through!
Aiden Chen
One thing nobody's mentioned - make sure you understand what a "confidential marriage" actually means in your state. In California, for example, a confidential marriage license means the marriage is not part of the public record, but it's still a 100% legal marriage with all the same rights and responsibilities. Also, double-check that your state allows the filing status you're planning. Most states follow federal filing status requirements, but some have different rules for state tax returns. My state requires you to use the same filing status on your state return as you did on your federal return, but not all states do.
0 coins
Niko Ramsey
I'm actually going through this exact decision right now! My partner and I are in a very similar situation - I make about $180K and she's in her final year of grad school with no income. We've been together for 5 years and are definitely planning to marry anyway. What really helped us was running the numbers through multiple scenarios. We used one of those tax calculators mentioned here and it showed we'd save around $14K by filing jointly. That's a significant chunk of change that could go toward our actual wedding or a house down payment. One thing I'd add - check if your girlfriend's grad program offers any emergency financial aid or grants that might be affected by your marriage. Some schools have specific policies about mid-program marital status changes that could impact her funding. We discovered her program had a small emergency fund for students in financial need that she wouldn't qualify for once we're legally married. Also, make sure you're both mentally prepared for the "secret" aspect. We've decided to tell our parents but ask them to keep it quiet until our ceremony. It felt weird not being completely transparent with family, but we want to preserve the specialness of our actual wedding day. The tax savings definitely make it worth it in our situation, but it's good you're thinking through all the implications first!
0 coins