Why do I need to sign a W9 for a credit card debt? - Bankruptcy Law Questions and Answers- LawQA.com

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Why do I need to sign a W9 for a credit card debt?

I owe $3555.55 to a credit card company. I said I would pay this amount and they started to play the game. They want me to sign a w9. I am ready to throw in the towel and file bankruptcy. Can you tell me what a w9 is for? I don't trust them. I recorded our phone calls. They said it was for a tax write off for chase mc.

Answer By Kevin Heupel
Heupel Law
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The credit card company wants you to sign a W9 so they can send you a 1099 on the debt. When you settle a debt, you have to pay taxes on the amount of debt settled.

Answer Applies to: Colorado
Replied: 8/10/2011

Mercado & Hartung, PLLC
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file the BK and schedule them, no need for the w-9

Answer Applies to: Washington
Replied: 8/10/2011

Answer By Ray Fisher
Ray Fisher Law Offices
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You do not need to sign anything for the credit card company.

Answer Applies to: Texas
Replied: 8/1/2011

Answer By Glen A. Kurtis
Glen A. Kurtis, P.C.
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If you settle a credit card for less than the full amount the company has the right to issue you a 1098 when they write off the remaining balance. The balance that was not paid must be treated as income to you and you would have to pay taxes on it.

Answer Applies to: New York
Replied: 8/1/2011

Theodore N. Stapleton, PC
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A w-9 is a request for your social security number probably so they can report any discount of the debt as forgiveness of debt income to you.

Answer Applies to: Georgia
Replied: 8/1/2011


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It is probably so they can report any debt they forgive as income to you to the IRS. Any debt that is forgiven is considered income.

Answer Applies to: Utah
Replied: 8/1/2011

Answer By Janet Lawson
Janet A. Lawson Bankruptcy Attorney
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I have no idea why they want you sign a W9. I suspect they are writing a portion off and will then have you taxed on the amount forgiven. A bankruptcy will prevent that from happening. Never record anyone in California without their permission. There is a $5,000.00 civil penalty if you are caught. Dump the recording. You can never use it.

Answer Applies to: California
Replied: 7/31/2011

Bankruptcy Law office of Bill Rubendall
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According to Wikipedia, a W-9 form is used by third parties to file an information return with the IRS on reportable payments made to others. It requests the name, address, and taxpayer identification information of a taxpayer (usually in the form of a Social Security Numberor Employer Identification Number- either number is considered a Taxpayer Identification Number.. The form is never actually sent to the IRS, but is maintained by the person who files the information return for verification purposes. The information on the W-9 and the payment made are usually reported on a Form 1096 or 1099.

Answer Applies to: California
Replied: 7/30/2011

Answer By Mark Markus
The Law Office of Mark J. Markus
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Yes, if you negotiate a reduction in payment to a creditor they will file a 1099 for forgiveness of debt income which becomes taxable income to you. Filing bankruptcy would avoid that problem.

Answer Applies to: California
Replied: 7/30/2011

Law Office of John C. Farrell, Jr.
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I have been in the trenches of the debt resolution business for years and I have come across Chase requesting a consumer filling out a W-9. However, I have seen it when they settle the debt for less or even write off the entire debt. Obviously, the form W-9 is the IRS form used by a company to request your taxpayer identification number. Most often, Form W-9 is sent to independent contractors, consultants, and other self-employed workers. Form W-9 is also used by banks and other financial institutions to request tax information from customers. You can ask Chase if you pay this amount whether you will still receive a 1099 form which you may have to claim as forgiven debt under the Internal Revenue Code. Regrettably, you already stated that you would pay the amount however if you were to settle the debt for less you could avoid filling out the W9 form and then deal with the 1099 later on.

Answer Applies to: Massachusetts
Replied: 7/30/2011

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