Car finance company sent us a 1099-c form for totaled car

[amethystraven]

My mother and my husband went in together for a car (he was a cosigner). After she passed away, we ended up totaling the car RIGHT after her funeral. (I was a nervous wreck) anyways, car insurance paid most off, and then the finance company forgave $1889 due to my mother passing (since she was the main one on the account). Since the car was totaled, would that be considered an exception? Since I do not have the property anymore (insurance company took it). 

[Carl]

I'm sorry for your loss, but since the finance company forgave the balance due after the insurance payout, you don't have to pay it back. Therefore it's no longer borrowed money. That money is "given" to the recipient whose SS appears on the 1099-C and it's now taxable income to that person. They have to report it as such on their tax return. Since your husband was a cosigner on the loan, that makes him 100% liable now that the other cosigner of the loan has passed. Sorry for the bad news.