why isn't the debt cancellation taxable for federal? The IRS gets a copy so you may get an inquiry if you leave it off your federal return.
When you use TurboTax the information flows from your federal return to the state return. Why do you think you do not need to enter the 1099C on your federal return? Enter it on the federal and it will flow to the state.
I need to do something with the federal 1099-C that is not supported by Turbo Tax Online, so i'm doing it manually. But I want to add the 1099-C to the state tax only. Is there a way to do this?
@number85 - can you explain more?
for example if you had federal student loan debt relief and are a resident of NC, there is no federal income tax to report, but there is NC income to report. That would be entered as an addition on the NC state tab only under 'discharge of student loan debt'.
if you could post that of detail, we can all help you out.
It is a 1099-C discharge of personal debt (credit card) and I need to add it as income on the state taxes. I'm located in California.
You enter the Form 1099-C on the federal tax return. The amount is on Form 1040 Schedule 1 Line 8c. The total from Schedule 1 Line 10 flows to the Form 1040 Line 8. This amount is included in your federal Adjusted Gross Income Form 1040 Line 11.
The amount from the federal return, Form 1040 Line 11 flows to the California Form 540 Line 13.
There is no California adjustment from income for the cancellation of credit card debt.
@number85 - cancellation of credit card debt is generally taxable income on the federal return. Why would you try to circumvent that?
Are you confusing credit card debt with student loan debt or mortgage debt?
forgiveness of student loan debt and mortgage debt are not taxable income on the federal tax return through 2025; however, unless insolvent, credit card debt forgiveness is taxable income on the federal return.
I need to fill out form 982 for federal which is not covered by turbo tax online. So will be doing that manually. So I need to enter 1099-C for State only. Is there a way to do that or no?
@number85 - -please provide more detail. Is this related to a bankruptcy? why do you believe you have to complete form 982? what state? it could be it doesn't get reported to the state either.