1099c

[Bonnie]

Has anyone ever heard of an individual issuing a 1099C to another individual? My client received a letter from the IRS concerning 2005 tax return with under reported income of over $8000 on a 1099C issued by another individual. What actually happened was the friend (or I guess you would say former friend) gave him the money back in 2001. They are no longer friends. My client never received a 1099C from this other person. How does someone manage to do this??

Thanks
Bonnie

[ChEAr$]

Unheard of

1099 forms, whatever variety,are not for casual use by individuals, rather only by those in
a trade or business.

So letter should be answered basically with this information and telling IRS to "prove it".
IRS should then contact the issue to get the facts. And if there were no formal note,
signed by the defaulter, then... how could it even BE proved?