Thanks for asking your question! I'm sorry to hear about your tax issue and I'm going to try my best to help you understand or resolve it.
According to PLR(NNN) NNN-NNNN--- "the determination of a taxpayer's entitlement to the insolvency exclusion under section 108(a)(1)(B) is based on all the assets reachable by the individual taxpayer's creditors. The filing of a joint return, pursuant to section 6013(b) of the Code, does not affect whether a spouse's separate assets will be used to determine the insolvency of the taxpayer."
So, she can still file the 982 by herself with her own assets, so if she is personally insolvent she would be able to exclude the cancellation of debt income from her income. However, her interest in joint assets would be counted as her assets, as would her interest in joint liabilities.
No need to file a separate return.
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