Tag Archive: cancellation of debt

Cancellation of Debt. Is it Taxable?

Written by March 1, 2013

When a lender cancels your debt, you may have to report this as taxable income on your federal income taxes, unless there is an exception. If you’re required to report the cancelled debt, the lender will send IRS Form 1099-C to you. The cancellation of debt can take many forms; from a short sale on a house to a negotiated...