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My husband and I went through a Chapter 7 Bankruptcy which…

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My husband and I went...
My husband and I went through a Chapter 7 Bankruptcy which was final in January of 2006. Yesterday we received a 1099 - C from the bank involved showing a cancellation of debt as 12/31/2009 with no interest and a debt description of Business Re and 3 loan numbers, The first loan was for graound we bought, the second for buying the business and the third was a loan for repairs we had to have done on the business which used our farm ground & house for collateral. There is not a fair market value listed and the bankruptcy is checked. Do we have to claim all this as income?
Alice
Submitted: 8 years ago.Category: Bankruptcy Law
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Answered in 16 minutes by:
1/12/2010
Bankruptcy Lawyer: Maverick, Attorney replied 8 years ago
Maverick
Maverick, Attorney
Category: Bankruptcy Law
Satisfied Customers: 6,427
Experience: 20 years of professional experience
Verified

If all the debt that is listed on the 1099-C forms was discharged during your bankruptcy you do not need to report it as income to the IRS. You may want to attach a note to your tax return informing the IRS of that fact.

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Maverick
Maverick, Attorney
Category: Bankruptcy Law
Satisfied Customers: 6,427
Experience: 20 years of professional experience
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Customer reply replied 8 years ago
I usually e-file. Should I not this year so that I can send an explanation?
Bankruptcy Lawyer: Maverick, Attorney replied 8 years ago
I had the same situation and I e filed and did not send a note. Everything was fine. You can still e-file and if a question arises, you can let them know by a letter at that time.
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Maverick
Maverick
Maverick, Attorney
Category: Bankruptcy Law
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