Where to put canceled debt on a 1040 Form?
Where to Put Debt Cancellations on a 1040 1 Issuing a 1099C. The IRS requires creditors and debt collectors to send out a Form 1099C when the forgiven debt exceeds a certain amount. 2 Reporting Canceled Debt. When you file your taxes, you'll need to report canceled debts on Form 1040. 3 Exceptions and Exclusions. 4 Considerations.
Do I have to report canceled debt on my tax return?
You should verify with the creditor your specific situation. Your responsibility to report the taxable amount of canceled debt as income on your tax return for the year when the cancellation occurs doesn't change whether or not you receive a correct Form 1099-C.
What happens after a debt is canceled?
After a debt is canceled, the creditor may send you a Form 1099-C, Cancellation of Debt (PDF) showing the amount of cancellation of debt and the date of cancellation, among other things. If you received a Form 1099-C showing incorrect information, contact the creditor to make corrections.