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Marvin,EA, Enrolled Agent
Category: Tax
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Experience:  Enrolled to Represent Taxpayers Before The IRS
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I received a 1099c for forgiveness of debt. If I am insolvent

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I received a 1099c for forgiveness of debt. If I am insolvent by more than the the amount of the forgiveness, do I need to pay tax? And should I complete tax form 982 to show this?


Hello and thank you for using Just Answer. You should complete Form 982 with your tax return if you were insolvent at the time of the debt forgiveness. If you were, you do not have to report the amount reported on Form 1099C. You should keep with your tax return a itemized account of your total assets and liabilities at the time of debt forgiveness for at least 3 years.
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