Question by Chris W: Does form 1099-C (cancellation of debt) have to be entered?
I am doing my girlfriend’s taxes through H&R Block’s website with their “tax cut” software. I have done this for the last 3 years with no problems but this year she has a form 1099-C (Cancellation of Debt) form that she hadnt ever received before.
I am trying to enter it on there because I just assumed that you would have to…but there doesnt seem to be anywhere to put it and when I search the “help” section for 1099-c, nothing comes up at all…
…but I look online for more info and it looks like some of the other tax softwares do have a specific place to put this form’s info in….
So is anyone familiar enough with the Tax Cut software and/or the 1099-C form that you would be able to tell me where/how to put this info in and/or whether or not this is really necessary to put in????
THANKS!
Thank you all for the information you have provided…I just wanted to give everyone a heads up about the info posted about Credit Solutions….In the past I followed up on a similar post I had seen (in fact, it read WORD FOR WORD the same as the one below). I have never worked with a less professional company. They are very quick to be sure to take every penny of the money you pay them in monthly fees. They then make the exact same settlements with companies that the companies would make with you personally….then all the ones that actually take any work to settle get left for 2 years while you continue to pay fees. No matter how hard you work to get them to fix THEIR banking errors, they still treat you unprofessionally and dont read the notes of the last 14 people you talked to about the same mistake—even when it is THEIR mistake. I would warn ANYONE, no matter how bad your situation, to STEER CLEAR of that “company”…they are huge scam. Which I know from personal experience.
Best answer:
Answer by lblackvelvet
no you don’t have to enter it , the other party whom filed the claim has to report it. it is not a income, just file without it.
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She should report the 1099-C on line 21 of Form 1040. See page 4 of IRS Publication 544.
However, if it is from foreclosure of primary residence in 2007 (or 2008, 2009) it might not be taxed. See http://www.irs.gov/individuals/article/0,,id=179414,00.html
I agree with efflandt. I am in the same situation. (Taxcut is not very helpful). According this website, http://www.pro1040.com/debt_cancellation.htm, it is supposed to be on line 21 of the 1040. In the Taxcut summary, there is a line for “other income”. That’s where I’m going to put it.
You either put it on line 21 *or* you show with form 982, why it shouldn’t be included in income. (Form 982 is for people who are in bankruptcy or close to it–and taxcut doesn’t suppor the form.)