Do i need to report a cancellation of debt from student loans?

[Anonymous]

I have received a letter from my loan servicer which states:
"A total of $0.00 in student loan debt was cancelled on loans we serviced for you during the 2016 tax year.
Interest totaling $0.00 is included in this amount.
This cancellation of debt may be considered as reportable income for tax purposes. Since the amount of cancelled debt does not exceed IRS reporting thresholds, we provide this notice in lieu of a 1099-C. This notice should be considered acceptable for use by your tax preparer."
Do i need to include this in my tax return?

[MichaelDC · Accepted solution]

Yes. Normally, you would need to report the cancellation of debt reported on Form 1099-C as income. However, since there was $0.00 cancelled, it's not necessary.

If there are other boxes on that form with non-zero numbers, you would do well to enter them in TurboTax and let the program decide what's best.