What is a 1099C? Will I owe taxes on my forgiven debt? Follow

The IRS considers a forgiven debt to be taxable income, and if you saved more than $600 on an enrolled debt, you (and the IRS) may receive an IRS Form 1099-C, Cancellation of Debt from the creditor. If the creditor reports the forgiven debt, the IRS will expect taxes to be paid on the settlement. The IRS also provides Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness, which may exempt you from this tax if you were insolvent at the time the debt was forgiven. Please contact a tax advisor to discuss this issue further.