Old Credit Card Nightmare

[daveleonard]

Jurisdiction

Florida

I have been in the Philippines since 2003. Before I left the States I paid all my balances and came to the Philippines. I had one credit card but paid that off.
I called the credit card company in 2006 and the man said that my account had been closed in 2006 for non-payment and the balance was written off. I did not know of any charges other than what I paid off.
In 2015 I sent a letter to the card company after seeing the credit bureau report about this debt and told them it was an honest error and that I would pay the balance just send me the paper work. I never heard back from them. I was never sent a notice of the cancel debt from any source. If this account was closed in 2006 or sold to a third party who inflated the balance from $800 to $24,000, that is an apparent violation of TILA. It appears someone "re-aged" this debt and that this may be a scam.

Someone apparently re-opened that suspended and written off account, charged me interest for nearly a decade and wrote it off on their 2014 income tax, which of course showed up on my IRS account as a cancel debt which I must figure as income on my 2014 tax return.
This is a big crisis for me because I live on my social security benefit and a small $320 pension. The card company or a third party charged interest on that $800 balance and it turned into $24,041 that they took off their tax and advised IRS, and I got the cancel debt. I am not claiming insolvency here in the Philippines but it is a hardship.
When I wrote the letter to them in 2015 they had my address yet I never received any information of this action and did not find out about it until my 2014 1040 was sent back by the IRS and the cancel debt revealed.
I earn approx $15,000 on social security, and $320 in a small pension. I have no job here in the Philippines, investments, business or any other income. I have no medical insurance, medicare does not work here. I take no withholding.
This means my income goes from about $18,000 paying no taxes to $49,000 and owing the IRS about $12,000. It will take me likely the rest of my natural life to pay this off, that is if they let me make payments on it. I am 70 years old now.

Is this right for a credit card company or a third party to do? It seems to me if they absorbed the $800 in 2005/2006 that they would have had to take the $800 off their taxes as a loss in that year and not re-open the case nearly ten years adding interest to their advantage and taking off $24,000 in 2014 on their taxes. If they sold this debt to a third party and they inflated the interest to $24,000 then this is a scam and is illegal.
Any advice? Thanks, Dave




daveleonard

 

[army judge]

Your request to pay the aged off debt, which the SOL also barred the buyer of the old paper from collecting on the debt, more than likely is the cause of your recent grief.

I suspect your request to pay off the debt is what created the opening for the SCAMMER to SCAM you.

Had you left it alone, there was nothing that could have caused you any financial harm, tax liability, or aggravation. In fact, the debt was over 12 years old. It more than likely aged off your credit report. Besides all that, living outside the US, your US credit report was more than likely meaningless in the PI.

You might want to consult an attorney.

I don't see too much harm because ALL the IRS can hit you for is 15% a month of your SS benefit. Perhaps another 15% of your $400 pension, but that might be untouchable.

The SCAMMER got the write off, and can't touch you as a FL resident.
You're what the law calls, a JUDGMENT PROOF DEFENDANT.
In essence, there's not much anyone (that includes the IRS) can do to destroy you.

 

[daveleonard]

Thanks for your reply and I appreciate it. But the hole in your theory is the fact that my letter to pay off the account was a year after (2015) the fact. The write off(1099) apparently took place in 2014. So my letter was not a factor upon what was already done. I never received an answer to that letter and I now see why.
So you agree that this is a scam? Will the IRS take this into consideration and cancel the 1099? Just asking and fishing for information so I know what my next step should be.
Thanks a lot. dave


QUOTE="army judge, post: 233540, member: 73455"]Your request to pay the aged off debt, which the SOL also barred the buyer of the old paper from collecting on the debt, more than likely is the cause of your recent grief.

I suspect your request to pay off the debt is what created the opening for the SCAMMER to SCAM you.

Had you left it alone, there was nothing that could have caused you any financial harm, tax liability, or aggravation. In fact, the debt was over 12 years old. It more than likely aged off your credit report. Besides all that, living outside the US, your US credit report was more than likely meaningless in the PI.

You might want to consult an attorney.

I don't see too much harm because ALL the IRS can hit you for is 15% a month of your SS benefit. Perhaps another 15% of your $400 pension, but that might be untouchable.

The SCAMMER got the write off, and can't touch you as a FL resident.
You're what the law calls, a JUDGMENT PROOF DEFENDANT.
In essence, there's not much anyone (that includes the IRS) can do to destroy you.[/QUOTE]

 

[army judge]

Thanks for your reply and I appreciate it. But the hole in your theory is the fact that my letter to pay off the account was a year after (2015) the fact. The write off(1099) apparently took place in 2014. So my letter was not a factor upon what was already done. I never received an answer to that letter and I now see why.
So you agree that this is a scam? Will the IRS take this into consideration and cancel the 1099? Just asking and fishing for information so I know what my next step should be.
Thanks a lot. dave


QUOTE="army judge, post: 233540, member: 73455"]Your request to pay the aged off debt, which the SOL also barred the buyer of the old paper from collecting on the debt, more than likely is the cause of your recent grief.

I suspect your request to pay off the debt is what created the opening for the SCAMMER to SCAM you.

Had you left it alone, there was nothing that could have caused you any financial harm, tax liability, or aggravation. In fact, the debt was over 12 years old. It more than likely aged off your credit report. Besides all that, living outside the US, your US credit report was more than likely meaningless in the PI.

You might want to consult an attorney.

I don't see too much harm because ALL the IRS can hit you for is 15% a month of your SS benefit. Perhaps another 15% of your $400 pension, but that might be untouchable.

The SCAMMER got the write off, and can't touch you as a FL resident.
You're what the law calls, a JUDGMENT PROOF DEFENDANT.
In essence, there's not much anyone (that includes the IRS) can do to destroy you.

No one can know what the IRS will do.

I don't claim to accurate on dates, but I'm sure the debt was dead. The SOL would have protected you.

The SCAMMER will sometimes pay 5¢ on an old debt. That deactivates the the SOL. Normally it's done a month or two before the SOL quiets all legal actions.

The fact that you were in the PI might have added to the effectiveness of the SCAM. I'm not sure this is exactly how it was done, but if you Google the name of the DEBT SCAVENGER/COLLECTOR I'm sure others have suffered a similar hustle.

The IRS is very hard to negotiate, unless you get to the right person.
You could try asking one of your FL senators, your Congressperson to assist you.

The IRS has an ombudsman who some people say is helpful and effective.

You can call the IRS ombudsman or tax advocate:

1-877-777-4778


You'll learn about FORM 911

A word of caution about the Form 911.

When you submit Form 911, whether the TA grants the request or not, signing the form operates to toll the collection statute of limitations.

The collection statute is the rule of law that limits the IRS' right to collect taxes.

Ordinarily, the agency has just ten years from the date of a tax assessment in which to collect.

After that period, the IRS' legal right to collect expires.

However, by signing Form 911, you extend that ten-year period beginning with the date of submitting Form 911 and continuing to the date of its disposition by the TA.

That is why I suggest you write a letter seeking relief, before using FORM 911!

Your letter will not stop the collection statute.





The links:




One Thing Every Citizen Must Know



Contact Your Local Taxpayer Advocate



2015 Form IRS 911 Fill Online, Printable, Fillable, Blank - PDFfiller