Consumer complaint received 2024-09-26
Product: Debt collection — I do not know
Issue: False statements or representation — Attempted to collect wrong amount
Company: SANTANDER HOLDINGS USA, INC. (TX)

I am writing to formally request the issuance of IRS Form 1099-C for an alleged debt that you charged off and reported to the credit reporting agencies. According to the information provided in my credit report, this debt has been categorized as " charged-off '' and, as such, I am seeking clarity on the tax implications of this action, as well as confirmation of the cancellation of the debt.

Legal Definition of Charge-Off A charge-off occurs when a creditor treats an account as uncollectible and writes off the outstanding balance as a loss for tax purposes. Under Generally Accepted Accounting Principles ( GAAP ), when a creditor determines that a debt is unlikely to be collected, the debt is charged off, effectively removing it from the creditor 's active receivables. This action signifies that the creditor has made the decision to cease further collection efforts through their internal process. Under IRS regulations, any forgiven or canceled debt of {$600.00} or more may be considered income to the debtor and requires the creditor to issue a 1099-C form, documenting the cancellation of debt.

Request for 1099-C Issuance Since this debt has been charged off, I am requesting that you fulfill your legal obligation by issuing a Form 1099-C, which reflects the cancellation of this debt. This form is necessary for me to address any tax obligations with the IRS, should the cancellation amount be considered taxable income. According to IRS guidelines, creditors must file a Form 1099-C when a debt of {$600.00} or more has been canceled or forgiven, and you must provide a copy to the debtor.

Accuracy of Information under 15 U.S.C. 1681e ( b ) Under 15 U.S.C. 1681e ( b ) of the Fair Credit Reporting Act ( FCRA ), it is your responsibility as a creditor to ensure that all information you report to credit reporting agencies is accurate and complete. Continuing to report a " charged-off '' debt without acknowledging the cancellation of the debt or issuing a 1099-C may result in inaccurate reporting, which violates this provision of the FCRA. Any inaccuracies that affect my credit report must be rectified immediately to prevent damage to my credit standing. 

Given that you have written off this debt and no longer expect payment, it is important that you comply with the reporting requirements under federal law by issuing Form 1099-C and providing me with a copy. This will serve as confirmation that the debt has been canceled, and I will be able to properly address any related tax implications. Request for Immediate Action Please issue and send me Form 1099-C within 30 days of receiving this letter, in compliance with your legal obligations. Failure to do so may result in the filing of
complaints with the IRS, the Consumer Financial Protection Bureau ( CFPB ), and other regulatory agencies, as well as legal action for violations of the FCRA.

If the debt has not been canceled or forgiven, I request a written explanation and clarification of the current status of this alleged debt, including a full accounting of the balance and any further collection activity. 

Thank you for your prompt attention to this matter. I look forward to receiving Form 1099-C within the specified time frame