Hi, everyone.
I received a 1099-C from Discover Student Loans. I panicked at first, and tried to figure out how I can claim insolvency since I certainly wouldn't be able to pay the taxes on the 1099-C. After much research, I noticed that Discover Student Loans closed their student loans department and cancelled most of their student loans.
I was already in default with the loan. The 1099-C I received has Code G on it (Code G is: cancellation of debt as a result of a decision or a defined policy of the creditor to discontinue collection activity and cancel the debt). I also read that under the American Rescue Plan, student loans cancelled between January 2021 and December 31, 2025 are exempt from federal income taxes (unsure of state taxes, so still researching; I'm in NY).
My questions are:
- What do I do with this? Do I file this?
- Do I still have to prove insolvency? What do I submit to prove insolvency?
- Can I still file online?
