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I received a 1099-C for a time share debt forgiveness. TT will only allow me to enter boxes 2 and 3 and not 7. Where do I enter this amount?

I received this on a time share I stupidly purchased.  I got the 1099-C after it was foreclosed on and sold at auction for $100 leaving a huge balance (surprise, surprise).  We got a 1099-C which has a date in box 1, "0" in box 2, box 6 is checked, and large amount in box 7 (38K+).  Turbo Tax allows us to enter boxes 2 and 3, but nothing else.  I read on the turbo tax sight that there was a mortgage forgiveness bill passed and am curious, did this fall under that.  https://turbotax.intuit.com/tax-tips/debt/when-to-use-tax-form-1099-c-for-cancellation-of-debt/L24iT....  I want to enter this where I need to to avoid a tax penalty later.
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1 Reply
PatriciaV
Employee Tax Expert

I received a 1099-C for a time share debt forgiveness. TT will only allow me to enter boxes 2 and 3 and not 7. Where do I enter this amount?

Because Form 1099-C reports zero discharged debt. this was not a taxable event. You are not required to include the 1099-C on your tax return.

 

The Consolidated Appropriations Act (CAA) that was signed into law on December 27, 2020, extended the exclusion of cancelled qualified mortgage debt from income for tax years 2021 through 2025. This may explain why there is no discharged debt on the 1099-C. Also, forgiven debt was less than $750,000 (maximum forgiveness amount).

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