1099-C

[irinaea]

Hi, 

My client has 1099-C Cancellation of Debt from Discover Bank.

I entered the full amount of canceled debt from Box 2 ($5,173.74) as Cancellation of Debt (COD) income under Income > Other Income in Pro Connect

I entered $501.34 as interest income from Form 1099-C. This will add the amount to taxable interest income.

Since the $501.34 from Box 3 is already included in the canceled debt amount in Box 2, I need to adjust ordinary income to subtract the interest to avoid double taxation $ 501.34 as ordinary and interest income.

I can't find the specific field to adjust it, so I used Other 24Z and got a message:

NOTE: No input should be entered below. The IRS instructions state Schedule 1 line 24z should be blank. Remove any existing input below.

Am I missing something, or my understanding wrong. I'm a first year with proconnect and need a help. Thank you.

[ThomasM125]

We are working with TurboTax here, not Proconnect, so I can only tell you that in TurboTax you would enter that as a negative "other" income amount on line 8(z) in Part I of Schedule 1. Here would be the procedure:

 1. From the Federal menu in TurboTax find Wages and Income 

2. Find Less Common Income

3. Choose Miscellaneous Income, 1099-A, 1099-C

4. Choose Other Reportable Income

5. Enter a description for the adjustment and the amount as a negative number

[irinaea]

Thank you,

It is really helps me.