General Discussion
Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region Forums"Cancelled debt is reportable to the IRS.
From the IRS:
In general, if you have cancellation of debt income because your debt is canceled, forgiven, or discharged for less than the amount you must pay, the amount of the canceled debt is taxable and you must report the canceled debt on your tax return for the year the cancellation occurs. The canceled debt isn't taxable, however, if the law specifically allows you to exclude it from gross income. These specific exclusions will be discussed later.-
Source: topic # 431 at the IRS
https://www.irs.gov/taxtopics/tc431
Johnny2X2X
(18,744 posts)As part of the American Rescue plan. All canceled student debt is not taxable through 2025.
EYESORE 9001
(25,812 posts)Nevilledog
(50,676 posts)questionseverything
(9,631 posts)Points up
SoCalDavidS
(9,998 posts)Some States won't conform, meaning the forgiveness could still result in State Income Tax.
Therefore, the Government will probably still issue a Form 1099-C, but when the amount is entered into the Tax Program, it won't be subjected to Federal Income Tax.
FoxNewsSucks
(10,375 posts)and Floriduh.
SoCalDavidS
(9,998 posts)Recursion
(56,582 posts)Hopefully it will get extended.
SoCalDavidS
(9,998 posts)Recursion
(56,582 posts)Sadly that's just a constant at this point