If you receive a 1099-C form for Cancellation of Debt, you need to amend both your federal and state tax returns to accurately report the income.
To amend in TurboTax: If you prepared your original tax return using TurboTax, log in to your account, open the tax return you already filed, and click on the link to amend your return. From there, the software will walk you through the process of filing the amendment.