r/tax•
ErisKukai

Best way to show insolvency in regards to a 1099-C and Form 982?

Hello tax experts. Throwaway account and first-time poster here. My apologies if this isn't the right place to ask.

Recently received an IRS letter stating that they think I owe more money on a past return due to a missing 1099-C (even though I did report it via Form 982 with my 1040). Naturally, I disagree. I do have all my documents pertaining to the year in question.

I was insolvent at the time, due to massive amounts of students loans and no major assets. To bolster my case, I want to provide documents to prove my insolvency. Since the return in question was from two years, I don't have anything that states exactly the loan and bank account balances were before the 1099-C issuance.

Would current documents work? Let's be real; it's not like the loan balances have changed all that much. Should I submit a copy of my credit report to also show that these I've had these loans for several years? What are your recommendations?

Thank you.

Posted Jul 31, 2015, 11:41 PM UTC

28
Loading comments…