What reason status code is used for written off debts that do not require a 1099-C generated?

The correct status code for written off debts that do not require a 1099-C to be generated is indeed W3. This code is specifically designated for situations where the debt has been formally written off, yet does not meet the criteria for reporting to the IRS with a 1099-C form, which is typically issued for cancellation of debt income when certain thresholds are met.

The W3 status code helps organizations accurately categorize these debts, ensuring compliance with financial reporting requirements without the need to issue a 1099-C for debts that are irrecoverable but are not significant enough to warrant the form's generation. Understanding and using this code properly allows for more accurate financial and tax reporting, which is essential for effective debt management within the GFEBS framework.