So Who Has to Deal With This 1099?

Question:

Dear Steve,

Divorced for 5 years both parties remarried since. Ex-spouse kept house, changed the deed to him but did not remove my name from the mortgage in the house he and his current wife reside. Per decree, he is assumed responsible for that debt with no obligation on my behalf.

Recently, after my current husband and I already filed, I got a 2019 form 1099c cancellation of debt (identifiable Code:F) for discharge amount of $224.72. Do I also need to file this or just my ex-spouse?

It was mentioned by the lender a small loan was recently paid off, they were unable to answer my question to file also or just him and I have tried calling IRS but they couldn’t answer my question so transferred me to dead end recordings that do nothing but state this service no longer available refer to www.irs.gov and disconnect afterward and probably read it over a few times with utter confusion. Please help, it’s driving me to madness not knowing what to do!

Dani

Answer:

Dear Dani,

I asked my tax expert friend for some advice for you. Jim Buttonow said, “From the limited facts, it looks like Dani’s ex-spouse should report the income on his return. If he does not report it, the IRS will likely not come after her for the small amount of income ($224).

Even if it is later determined that Dani must report the income, the small amount of $224 in additional income may not have any impact on her return. If it has no impact, she can disregard.”