Foreclosures, repossessions, charge-offs, bankruptcies, and debt settlements can all create complicated year-end tax reporting questions. Does the institution file a 1099-A, a 1099-C, or both? When has an identifiable event occurred? What amount should be reported when collateral is repossessed or sold? What happens when a deficiency remains or the institution later agrees to forgive it? This webinar will provide a practical review of the federal tax reporting rules that apply when a borrower defaults and the institution takes collateral, cancels debt, or settles for less than the amount owed. We will walk through Forms 1099-A and 1099-C in detail, including what belongs in each box and the events that trigger filing. We will examine real-world scenarios involving mortgage foreclosures, deeds in lieu, vehicle and equipment repossessions, abandonment of collateral, charge-offs, deficiency balances, and negotiated settlements. We will also discuss some of the situations that create the greatest confusion for financial institutions: What if the institution repossessed collateral this year but does not forgive the deficiency until next year? Does a charge-off automatically trigger a 1099-C? How should fair market value be determined? What if multiple loans are secured by the same collateral?
KEY WEBINAR TAKEAWAYS
- When your institution must file Form 1099-A, Form 1099-C, or both
- Events that trigger reporting
- IRS rules for canceled debt, deficiency balances, charge-offs, and negotiated settlements
- 1099 reporting when a borrower files bankruptcy or receives a discharge
BONUS MATERIALS
- 1099-A and 1099-C reporting decision guide
WHO SHOULD ATTEND?
- Deposit operations personnel
- Loan operations personnel
- Accounting clerks and tax personnel
- Managers
- Compliance officers
MEET THE PRESENTER
Shelli Clarkston
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