I filed my taxes last week at a tax prep service. A simple filing. No problems.

I received a letter in the mail yesterday, a letter from an old creditor and it was a Cancellation of Debt. It said it they were cancelling this old debt and there was ....I think a 1099-C form. And they were sending it to the IRS too.
The debt was 10,000.

Here is what happened....7 or 8 years ago I got an auto loan for a chevy blazer for like 13 grand. I had to quit my job to care for my elderly grandparents and I couldn't make the payments. I had paid only a couple thousand on it. The blazer was repossessed. Then the auto loan company said that even though they took possession of the blazer, that I had to still pay the entire balance of 10 grand in full.

But of course I had no money, I couldn't work, I was caring for my grandparents, but I couldn't pay 10 grand for a car I didn't have anymore.

Well, I figured that eventually it would come off my credit report. I think it was due to come off last year. Well, according to this form...I have to pay taxes on a car from years ago that was repossessed?

Also, since I already filed my taxes with a service will the IRS take the money out of THIS years tax return? I was counting on this money, I had no idea this was gonna happen. I haven't received anything from the IRS yet, just the loan company.

Help! I dont think this is right.