Justin W. Ellis - Page 3

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          for the year in issue, and all Rule references are to the Tax               
          Court Rules of Practice and Procedure.                                      
               Respondent determined a deficiency of $2,609 in petitioner’s           
          Federal income tax for 2002.  The issue for decision is whether             
          petitioner received $11,628 of income from cancellation of                  
          indebtedness owed to General Motors Acceptance Corp. (GMAC).                
               The undisputed facts, as stated by petitioner, are as                  
                    The Petitioner incurred an obligation to General                  
               Motors Acceptance Corporation (hereinafter “GMAC”) in                  
               the original amount of $14,435.99, in conjunction with                 
               the acquisition of a 2001 Saturn SL1 vehicle from                      
               Saturn of Knoxville on April 28, 2001.  This obligation                
               was payable through 39 monthly payments of $367.41,                    
               beginning April 28, 2001.  The Petitioner failed to pay                
               the monthly payments in accordance with this contract,                 
               and the General Motors Acceptance Corporation declared                 
               the obligation in default and repossessed the vehicle.                 
               The vehicle was then sold, and the deficiency                          
               obligation then remaining and due and owing General                    
               Motors Acceptance Corporation was $11,628.77.  Demand                  
               was made upon the Petitioner for payment of this                       
               deficiency obligation by letter from GMAC dated                        
               December 21, 2001.  * * *                                              
          It is also undisputed that GMAC sent a Form 1099-C, Cancellation            
          of Debt, to petitioner and to the Internal Revenue Service in               
          2002, reporting that petitioner received cancellation of                    
          indebtedness income in 2002 in the amount of $11,628.  Petitioner           
          contends that GMAC never released, canceled, nor discharged his             
          obligation and that the Form 1099-C was erroneous.                          

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