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Capital One issue 1099-c, Still reporting Balance

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I had a credit card with Capital One that was charged off back in 2011, i tried settling it, but was never able to get hold of anyone there so on 12/31/2013 they send me a 1099-c (Cancellation of Debt)

However, they are still reporting the balance on all 3 credit reports.

Past due amount and Balance are the same amount as the amount they reported under section 2 of my 1099-c, which is amount of debt discharged. And then I went ahead and report this on my tax return as income

Under instructions on 1099-c it clearly states that the lender has discharged (canceled or forgiven) a debt I owed.

But til today they keep reporting this to all three agencies


Same EXACT story with my Bank of America card.

Are they allowed to report Balance owed AFTER they have issued 1099-c?

I called the 800 number and they acknowledged that even thought they CANNOT actively pursue this account for collections, they are still required to report the balance.

Does this sound right? Has anyone been able to get the balance to go to zero?



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  • 2 weeks later...

@dj_seventy7 this may be helpful. https://www.stcwlaw.com/images/legal-primer/the-issuance-1099-C-fair-credit-reporting-act.pdf

You'd probably want to dispute the entries for reasons other than cancelled debt. Make sure to do this with the credit bureau first.


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You're in the 4th Circuit which has not ruled on the issue.   However, most courts that have ruled on it have determined that a 1099 C does not extinguish a debt.    Also, the IRS requires that creditors file a 1099 C.   It doesn't mean that the creditor has determined that you no longer owe the balance.

The balance was never paid.  Absent a settlement agreement stating otherwise, that balance is still owed to the creditor.   However, if the creditor were to sell the account to a junk debt buyer (JDB), the creditor would then be required to report the balance as -0- because it no longer owns the account and could not accept payments.


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