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SSA.Help4u.168, Accountant
Category: Social Security
Satisfied Customers: 3713
Experience:  Tax Accountant
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I am on social security disability and received a 1099-c for

Customer Question

I am on social security disability and received a 1099-c for next year. Will I have to pay social security tax because my income is more than $25,000? The 1099-c is for $59, 921. My wages are $9000. My social security disability is $11,328.
Submitted: 2 years ago.
Category: Social Security
Expert:  SSA.Help4u.168 replied 2 years ago.
Thank you for contacting us today. My goal is to provide efficient assistance to you and hopefully a peace of mind as well.
You may meet an exception and not have to include the 1099-C income. What type of debt is the 1099-C for? Are you insolvent? Have you file BK?
If you meet one of the exceptions, you will not need to include the 1099-C income. However, if you do not meet an exception and have to include the income, it is likely that a portion of your social security (up to 85%) can be taxed. SEE BELOW:
Canceled debts that meet the requirements for any of the following exceptions or exclusions are not taxable.
Debt Cancellations or Reductions that Qualify for EXCEPTION to Inclusion in Gross Income:
Amounts specifically excluded from income by law such as gifts, bequests, devises or inheritances
Cancellation of certain qualified student loans
Canceled debt, that if it were paid by a cash basis taxpayer, would be deductible
A qualified purchase price reduction given by a seller
Any Pay-for-Performance Success Payments that reduce the principal balance of your home mortgage under the Home Affordable Modification Program
Canceled Debt that Qualifies for EXCLUSION from Gross Income:
Debt canceled in a Title 11 bankruptcy case
Debt canceled during insolvency
Cancellation of qualified farm indebtedness
Cancellation of qualified real property business indebtedness
Cancellation of qualified principal residence indebtedness
Let me know if you require further assistance with this matter.