No, you would not report it on your 2016 tax return if you did not receive a 2016 1099-C. You should wait until you receive the 1099-C from the lender. Although, you have satisfied part one of the settlement they may not issue the 1099-C until the entire amount is satisfied. At that time the lender will report the cancellation of debt to the IRS and send you a copy of the 1099-C. At that time is when you will be required to file the cancellation of debt on your tax return in the tax year that you receive the 1099-C and not the year that you settled the debt.
