Today, four days after filing my 2005 Federal taxes, I received what looks like a valid 1099-C in an amount equal to the balance ($5,200.00) from an auto repossesion in January, 2003.

Since I've filed, what's the likely action by the IRS ?
Should I wait until I see what happens, or file an amended return now ?
Will this trigger an audit ?
Will they just adjust my refund accordingly ?

Finally, (last one, I promise) does this mean the account is now "settled" or "paid in full" for essentially the taxes I'll pay ?

Thanks for your patience !

Quote:

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Originally Posted by hameline

Today, four days after filing my 2005 Federal taxes, I received what looks like a valid 1099-C in an amount equal to the balance ($5,200.00) from an auto repossesion in January, 2003.

Since I've filed, what's the likely action by the IRS ?
Should I wait until I see what happens, or file an amended return now ?
Will this trigger an audit ?
Will they just adjust my refund accordingly ?

Finally, (last one, I promise) does this mean the account is now "settled" or "paid in full" for essentially the taxes I'll pay ?

Thanks for your patience !

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No this does not mean it is settled and it will never be paid in full it will always show a reprosession on credit report.

The IRS will receive a copy of this also, and if not on your return they will either consider this a fraud in not properly reporting or an error.

In any case you should file an amendment.

I am not a tax expert but I know if you don't include something to the IRS they know and will contact you, normally with penalties added.

Hameline:

Fr Chuck has it right. You need to file an amended return.