As some of you know an arbitration award has been done against me by NAF, and soon the JDB will try to affirm to judgement. The award is for 4 times what the OC charge off was, and is 2X's more than what the arbitration suit was claimed for just several months before. I have written to NAF as to HOW they have come up with such an amount of 2X's what the arbitraion suit was, and NO REPLY. Ok so here is my dilemma, IF I were to do a deal to get rid of this nonsense with the JDB, I want to word it correctly so this is a done deal never to come up again, and also no transfers ,sold, traded, yada yada,AND my main question is,say I settle for 5K and the award is 40K, I don't want a 1099 for 35K, so how do I get this NOT to? I WILL have a lawyer doing the paperwork but I also want to guide him as to how to go about it as he is not a NACA lawyer and quite frankly it has come to light that I have more knowledge about somethings than the lawyer has.: ( I mean we KNOW that this JDB did not pay anywhere near the CO on the account, AND like I said the arbitration amount was for LESS than half of what they awarded, so HOW do I get this 1099 NOT to go with the 40K but at the very most the OC of 10K? If I can't do this then I just will pursue the case in court. So to wrap it up... Need to know how to word the paperwork agreement. Need to know if I have to deal with a 1099 and for HOW MUCH Oh and the fact that NAF issued an award for twice as much and will not reply to HOW they came up with such,anything I can do? As for me thinking of settling, it is going to be a lot less giving them 5K and a done deal then dealing with this any l onger thru a lawyer as I will have to keep fighting this so a judgement does not occur, which really is no biggie cept for my CR as I have taken care of assets,etc. Thanks much
I have read somewhere that the 1099 can only be for the amount of principle that the debtor has not paid. Example 10,000 credit card bill debtor settles for 5,000.Even though the principle and interest could of made the debt 15,000 and the arbritrator grants the creditor double that amount the 1099 can only be for 5,000.That is the amount the debtor was enriched by not paying the full amount and thus the 5,000 is considered extra income.
Thank you peeper, I have read this as well, but I want to know for sure and how to word it just right . : ) Woofer
He makes a good logical argument. I wonder what the tax courts say. It would be neat if you could quote Sheperdized case law in your letter/agreement.
