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becaz5150

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I had a creditor tell me that they were going to add $5000 to tax return can they do that

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No, that's illegal. Only the IRS can touch your taxes, wages, cars, houses, kidness..... Call them back and let them know that your rights were violated and that you are filing a complaint with the FTC (Federal Trade Commisson). Then make an outrageous settlement offer to keep things from escalating. Good Luck. By the way the FTC's job is to slap businesses with huge fines and even will shut down companies for fraudulent practices that violate consumer rights. Look them up.

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Reply by
jwsister

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They can't add it to your tax return but, if they cancelled a debt,  they can report it to the IRS on form 1099 C and it will qualify as regular income.  If they have done so, you will receive a copy of the 1099-C early in the year so you can have it for filing your tax return.

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