I would ask one of the tax experts what happens when you both receive 1099-C forms. In my case, I was the borrower and the only one to receive the 1099-C. My cosigner did not receive a form. My cosigner had his tax preparer create a letter for the IRS explaining who I was and that I received the 1099-C and to refer to my tax return in case the IRS would somehow find a way to link my cosigner to my 1099-C anyway. The letter was sent along with my cosigner's filed taxes. It was strange, but it wasn't rejected.
