Re: Converting judgement against tenant to IRS - Landlord Forum thread 345105

Re: Converting judgement against tenant to IRS by Anonymous (CA) on May 21, 2016 @21:51

You would file a 1099c. You need to talk to your tax advisor.

However, the the only reason is payback, filing a 1099c probably won't work.

If their liabilities (including your judgement) exceed the fair market value of their assets, they are insolvent.

If they are insolvent, they will not owe any taxes for the 1099c. And now, they are completely off the hook.

They simply file a Form 982 with their 1040. Publication 4681 describes the process.

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