Debt collector for Advanta wants to sue me in Utah, but I live in California
I live in California the last activity on my credit card was on June 2007, just received a letter from debt collector that they want to sue me in state of Utah, because allegedly the agreement I signed with advanta says they can sue me in Utah which they say statue of limitation is 6 years instead of my home state of California which is 4.
Can they sue me in Utah while I always lived in California, and even if they get a judgment in Utah can they enforce that judgment in California?
—BOB
It is extremely unlikely you are going to be sued in Utah for the Advanta credit card debt you stopped paying in 2007. Advanta folded up. Any Advanta collection accounts the remain are sent from one debt collector to another etc. Suing you in California is not going to happen either.
I have not actually seen an Advanta collection attempt using the court in years.
Can you post a reply below with exactly what the letter said? Did it “imply” a lawsuit “could” be filed, or did it state in plain language that you are going to be sued?
If it was plain language used, I will probably encourage you to call an experienced consumer attorney in California to look into whether there are collection violations worth looking into. If there are, most of this type of violation can be pursued by an experienced attorney at no cost to you, so it’s worth looking into.
Post more information in the comment section below and lets go from there.
About Michael BoveeMichael started CRN in 2004 with a mission to provide people in need with detailed debt and credit help and education. Michael has participated as an expert panelist in federal consumer protection rule making, collaborated on state law changes governing debt consolidation, has worked as an expert witness in court matters related to the debt relief industry. He is available to speak with you about your financial struggle and helps people resolve their debt problems daily.
I had to look up “fits and starts” as I’ve never heard that expression.
Three years passed in 2013 and since my mailing address changed after the account went into default, I have no way of knowing if they have already sent the 1099c or how much the total is as there is a differnce between what I have from last correspondence and what’s reflected on my credit reports.
If I was to amend my 2013 return to pay the average of the two amounts but they don’t send out a 1099c until a different tax year, would I have to amend my 2013 return again? Or would it be better to wait for a notice from the IRS and pay the 3% penalty?
I would talk to a tax pro about it Melissa. If it were me, and based on the fact that it was a small business debt, and not originally a personal credit card with Advanta, I could see waiting for the 1099c to be issued.
I had a business credit card from Advanta Bank for which I was personally liable. The last pymt made on the acct was in July 2010. In Sept 2015, I called to see if a 1099c was going to be or had been sent out as the address on file for the business was no longer my mailing address. I wanted to know when I needed to report it as income with the IRS. Did I inadvertently reset the statue of limitations for Louisiana which is 3 years for credit card debt? The only thing I asked was about the 1099c and when he responded by saying “this is an attempt to collect a debt’ I responded that the SOL had expired. He tried to have me update the phone numbers on file but I declined.
I believe Louisiana would only reset the SOL to sue for the debt if you were to send a written acknowledgement of the debt, and not for a simple phone inquiry.
The business debt may have been treated as non personal for accounting purposes and therefor no 1099c sent out. Given the fact that Advanta bank was closed and the FDIC brought on to act as receiver, I would check with them about any specific tax implications, and whether or not the debt collector you are contacting is working for the purchaser of your debt, or for the receiver. I suspect you could be dealing with a debt buyer at this point, so any tax implications related to your Advanta account is still possible to receive notice of.
Thank you for taking the time to respond to my question.
One follow up question–Do you know if there is a SOL on how long a 1099c can be sent out?
The presumed time frame for 1099c cancellation of debt has been viewed as 3 years of no effective collection. I have been doing this type of work for a long time and can tell you I have never seen this implemented with any consistency. I have seen fits and starts with the 3 year IRS guideline, but that’s it.
I have never seen this to be a priority for the IRS, and there was a proposal by the IRS to remove or amend the rule. See this brief report: https://www.thetaxadviser.com/news/2014/oct/20141014.html