Taxpayer never brought in 1099-C in 2021 for $26,000 from citi mortgage company. They got a letter that they owe the IRS $7,505. Is there anything that can be done about this?
Thank you
Check insolvency rules. If it’s CC debt and the taxpayer had more debt than equity you can look at the insolvency worksheet. You’d have to amend 2021 return.
https://www.irs.gov/pub/irs-pdf/p4681.pdf
Did you read about non-recourse States for mortgage debt?
https://www.investopedia.com/ask/answers/08/nonrecourse-loan-vs-recourse-loan.asp
And which States?
"Which states are non-recourse mortgage states?
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