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Form 1099-C, Cancellation of Debt Taxpayers could receive Form 1099-C if they had any debt cancelled in excess of $600 (may receive Form 1099-A if a property). In a typical year with no extensions, Form 1099-C must be issued to taxpayers no later than January 31st. Taxpayers who are not insolvent and whose debt is not in relation to a Title 11 bankruptcy MUST include the debt as income on their 1040. Taxpayers who are insolvent or whose debt is related to a Title 11 bankruptcy may be able to exclude the debt from income using Form 982. For more information reference What is Insolvency? and Form 982.
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Follow the instructions below to correctly enter the Form 1099-C (taxpayers who do not qualify to utilize Form 982):
Select Add Form.
Image ModifiedBegin by typing 1099-C, into the search bar at the bottom of the All Forms and Schedules Menu.
If a joint return, choose New Taxpayer's or New Spouse's Occurrence.
Select Form 1099-C. Double-click to add the form.
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Image AddedComplete the 1099-C, filling in all applicable sections.
Select To Form: in box 2.
Select Choices from the Active Options Window.
Choose SCH 1 Line 8 C.
