Debt cancelled during insolvency (the amount exceeding your assets);
Cancellation of qualified farm or real property indebtedness.
If the debt qualifies for any of these exclusions, TurboTax will complete Form 982 and include it with your return.
Certain qualified student loans;
Money excluded from income by law, such as gifts or bequests;
Cancelled debt that if paid by a cash-basis taxpayer would otherwise be deductible;
A qualified purchase price reduction given by a seller;
Any Pay-for-Performance Success Payments that reduce the principal balance of your mortgage under the Home Affordable Modification Program.
Tip: If your creditor is still trying to collect on your debt, it's not considered cancelled, forgiven, or discharged. There is no taxable income to report, not even if you got a 1099-C from the creditor.