catlingirl
Active Member
Has anyone ever gotten one of these before.? Did you claim it on your taxes. Not sure what to do. I looked it up but just got even more confused. Thanks
Debt has been forgiven tax form
- Thread starter catlingirl
- Start date
Restitution
New Member
Do you mean something along the lines of a debt that went unpaid and was eventually written off by the debt holder? If so, then you WILL need to claim it and you will take a hit on it.
kwillia
n/a
A few years ago a friend of mine did a debt consolidation and debt forgiveness. At the end of the year he was required to pay taxes on the amount that was forgiven. You have to claim it as income.
Dakota
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Yes... you have to claim it as income. It goes under "OTHER INCOME" and you would title it "COD" (Cancellation of Debt).
Line 21. Most programs have a block to enter it in because it is SOOooooo common these days.
This is how banks get rich. They write off the $ they never got and you pay taxes on it. Often, they didn't collect all the interest they wanted on money they borrowed from the government (aka/tax payers) that they in turn lent you.
Line 21. Most programs have a block to enter it in because it is SOOooooo common these days.
This is how banks get rich. They write off the $ they never got and you pay taxes on it. Often, they didn't collect all the interest they wanted on money they borrowed from the government (aka/tax payers) that they in turn lent you.
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Yes... you have to claim it as income. It goes under "OTHER INCOME" and you would title it "COD" (Cancellation of Debt).
Line 21. Most programs have a block to enter it in because it is SOOooooo common these days.
This is how banks get rich. They write off the $ they never got and you pay taxes on it. Often, they didn't collect all the interest they wanted on money they borrowed from the government (aka/tax payers) that they in turn lent you.
How exactly do "banks get rich" when writing off loans?
Do you understand anything at all about how loans are made? Obviously not.
Using your comments, the credit crisis and Great Recession should have been a massive profit generator for banks. So why did so many fail? Here's the list: https://www.fdic.gov/bank/individual/failed/banklist.html
Banks that make loans, get the money they loan from depositors (haven't you ever watched "It's a wonderful life"???), not the govt.
If the bank makes you a loan and you fail to pay, that is a loss to the bank. Sure they can repossess the house or the car...and recoup some of their losses...but a repossessed property generally doesn't sell for enough to cover the loan.
Your comments could not be more wrong.
Dakota
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When I posted that. my mind was thinking “credit cards,” not loans, nor did I ever say "loans." Lets face it, it is primarily the reason these COD's are seen. I was a Countrywide Credit card holder who was sold to Capital One many years ago. The agreement with Countrywide was 2 percent until the balance was paid off. 20/20 did a show where many card holders used this deal for medical reason and in my case, to pay for a funeral.
When greedy Capital One took over the card, they jacked up the rates to 18-26 percent for each card holder. Now when Capital One bought the credit accounts from Countrywide, they paid a fraction of the costs. What would have been nice is offering the same deal to the consumer, perhaps they would have even made more money and instead of getting 25 cents on the dollar they could have gotten 50 cents on the dollar but it didn’t work out that way. So Captial One buys a $10000 balance from Countrywide for $2500 but expects the card hold to pay the balance plus interest at their rate (not 2% but now 18% or more). Several COD’s I have seen are because of settlements with credit card holders who wanted off the crazy train.
LightRoasted
If I may ...
If I may ...
You are one STUPID person. So, by your comment, life imitates art (the movies)? By law, the Federal Reserve Act of 1913, banks cannot lend their customers deposits nor their own assets. They create, out of thin air, that money they are lending you when you sign the loan documents for it. As for credit cards, when you sign the credit card application, and say they approve you for $10000, $10000 is created and deposited in an account under your name with that bank... you do not see this. When you use the credit card, amounts used are drawn down against the original $10000 balance. When you pay it off, the balance goes back to $10000 for you to use again. I'd sit here and try to explain modern banking to you, but since you are so smart, I'll let you do your own research into it. But as far as your comments? You, could not be more wrong.