Do you have a Related Finance Company (RFC)? Have you been considering starting one?
Have you filed your 1099-C yet? Do you know what that is?
The Auto Dealer Business School is committed to educating dealers on the best and most profitable business practices including helping you understand the form 1099-C.
1099-Cs: What You Need to Know
In recent years, Buy-Here-Pay-Here dealers have come under IRS scrutiny for noncompliance with Form 1099-C reporting requirements. With penalties of at least $250 per form and a fast-approaching deadline, here are a few key things you should know about 1099-Cs.
What is a 1099-C?
Form 1099-C "Cancellation of Debt" is a form the IRS requires "applicable financial entities" to issue when a debt of $600 or greater has been canceled or forgiven. In dealer speak, this translates to a charged off account with a net loss (after repo ACV recovery is applied) of $600 or more. Depending on the nature of charge off, you may or may not be...