You can exclude the income due to bankruptcy. Be sure you retain all of the paperwork in case if you are examined by the IRS. Here is how to report.
- Log into your account
- Select Wages and income
- Less Common income
- Miscellaneous Income, 1099-A, 1099>start
- Go to cancellation of debt.
- Enter the 1099C details
- After you entered, you will be taken back to the miscellaneous income section
- Select other reportable income
- Other taxable income, answer yes
- Under brief description, call it " 1099 C income excludable due to Chapter 7 and then enter the amount of 1099 C with a negative sign in front of it. (Ex: -xxxx.xx)
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