If you received a 1099-C for a cancellation of debt, you must include the amount of the cancellation in your income. This is because you received a benefit from having the debt discharged.
Under certain conditions, you can file Form 982 to exclude or reduce the amount of the cancellation of debt from your income.
To enter Form 982 within the program, please go to:
- Federal Section
- Less Common Income
- Cancellation of Debt Form 1099-C, Form 982
- Exclusions (Form 982)