cvictorg
New Member
http://www.nytimes.com/2014/03/28/y...-tax-bill-from-the-irs.html?hpw&rref=business
Six months after his wife learned that she had a rare vascular disease of the brain, Frank, now 66, lost his job as director of sales of a telecommunications company. His wife, to whom he had been married for 36 years, died just two months later.
He was still grieving when he learned that he had kidney cancer. The tumor was operable, but the exam brought to light a long list of other serious problems, including a pulmonary embolism and a heart-rhythm disorder.
That was in 2009, in the depths of the recession, and finding a new job was difficult. Two years later, after struggling to pay medical bills not covered by insurance and other debts, Frank filed for bankruptcy. But that did not erase the giant pile of federal Parent Plus loans that he had taken out to help put his three children through college. Since he could no longer work, Sallie Mae, the loan servicer, ultimately suggested applying for a disability discharge, which would cancel the debts.
He qualified, and last July, his loans, which had ballooned to $150,000 in forbearance, were wiped away. “I felt like a Buick had been lifted off my shoulders,” said Frank, who lives in upstate New York.
But much to his surprise, he received another bill. In January, the Internal Revenue Service sent him a tax form, known as a 1099-C, which said that the loan amount had to be treated as income. According to his calculations on TurboTax, his tax bill for this year is about $59,000.
“If I am not capable to work due to a medical disability to pay the student loan, how am I supposed to work to pay the taxes?” said Frank, who agreed to discuss his situation only if his full name was not published. “Now I am somewhat panicked.”
Six months after his wife learned that she had a rare vascular disease of the brain, Frank, now 66, lost his job as director of sales of a telecommunications company. His wife, to whom he had been married for 36 years, died just two months later.
He was still grieving when he learned that he had kidney cancer. The tumor was operable, but the exam brought to light a long list of other serious problems, including a pulmonary embolism and a heart-rhythm disorder.
That was in 2009, in the depths of the recession, and finding a new job was difficult. Two years later, after struggling to pay medical bills not covered by insurance and other debts, Frank filed for bankruptcy. But that did not erase the giant pile of federal Parent Plus loans that he had taken out to help put his three children through college. Since he could no longer work, Sallie Mae, the loan servicer, ultimately suggested applying for a disability discharge, which would cancel the debts.
He qualified, and last July, his loans, which had ballooned to $150,000 in forbearance, were wiped away. “I felt like a Buick had been lifted off my shoulders,” said Frank, who lives in upstate New York.
But much to his surprise, he received another bill. In January, the Internal Revenue Service sent him a tax form, known as a 1099-C, which said that the loan amount had to be treated as income. According to his calculations on TurboTax, his tax bill for this year is about $59,000.
“If I am not capable to work due to a medical disability to pay the student loan, how am I supposed to work to pay the taxes?” said Frank, who agreed to discuss his situation only if his full name was not published. “Now I am somewhat panicked.”
