Consumer complaint received 2022-04-21
Company: RFNA, LP
State: TN
Product: Payday loan, title loan, or personal loan
Sub-product: Pawn loan
Issue: Incorrect information on your report
Sub-issue: Account information incorrect

Complaint:
REPUBLIC FINANCE has account listed as charge off but is still reporting amounts and increases to my consumer reports which is illegal and unlawful.

The definition of a Charge Off, pursuant to 7 CFR 1956.54, is The writing off of a debt and termination of collection activity without release of personal liability.

The status of this account reporting as a Charge Off is an inaccurate account, which is a violation of 15 U.S. Code 1681e ( b ).

Referring to the IRS Publication, Publication 4681 Cat. No. 51508F Canceled Debts, Foreclosures, Repossessions, and Abandonments ( for Individuals ), Even if you didn't receive a Form 1099-C, you must report canceled debt as gross income on your tax return unless one of the exceptions or exclusions described later applies. '' Pursuant to 26 U.S. Code 61 ( a ) ( 11 ) - Gross income defined Except as otherwise provided in this subtitle, gross income means all income from whatever source derived, including ( but not limited to ) the following items : Income from discharge of indebtedness.

As defined by the IRS, even if you didnt receive a Form 1099-C, you MUST report Canceled Debt as Gross Income on your tax return, according to the IRS. For an account to be Charged Off, the debt had to have been Canceled. Canceled Debt must be reported as Gross Income on a tax return. Its illegal to report Income to my consumer report.

According to Publication 4681 Cat. No. 51508F Canceled Debts, Foreclosures, Repossessions, and Abandonments ( for Individuals ) Also, if your debt is canceled and the lender must file Form 1099-C, the lender can include the information about the abandonment on that form instead of on Form 1099-A. The IRS clearly explains that if my debt is canceled then the lender, which is yourself, MUST file a 1099-C.

If ( REPUBLIC FINANCE ) has filled out a 1099c form and is continuing any kind of collection activity as defined under 31 U.S. Code 3711 ( e ) by performing any of the following conduct ; administrative offset, tax refund offset, referral to private collection contractors, referral to agencies operating a debt collection center, reporting delinquencies to the credit reporting agencies, garnishing wages, pursuing litigation or foreclosure, you are committing tax fraud and should be reported to the IRS for a fraudulent financial gain. 

I am aware that a 1099-C must be mailed to consumers by XX/XX/XXXX the following calendar year in which the identifiable event occurs. I did not receive anything which is a violation. If your company has mailed me a 1099-C, please provide documentary evidence, such as a tracking number, that proves I in fact received and was aware of a 1099-C.

Referring to the IRS Publication, Instructions for Forms 1099-A and 1099-C ( Rev. XX/XX/2022 ) Acquisition or Abandonment of Secured Property and Cancellation of Debt. " Form 1099-C must be filed regardless of whether the debtor is required to report the debt as income. '' If the canceled debt was not more than {$600.00}, ( Republic Finance ) is still required to report the debt as income to the IRS. 

The continued reporting of this inaccurate information is a clear violation of 15 U.S. Code 1681s-2 of your responsibilities as a furnish of information & 15 U.S. Code 1681e ( b ).

Company response to consumer: Closed with explanation