If your debt is cancelled or forgiven, you'll receive Form 1099-C (Cancellation of Debt). Most of the time, cancelled debt is taxable, but there are exclusions and exceptions. We'll check for those after you've entered your 1099-C.
To enter your Form 1099-C in TurboTax, please follow the steps below:
- Sign in to TurboTax (if you're not already signed in).
- Click on the Take me to my Return button
- Click on the Federal Taxes tab
- Click on the Wages and Income tab
- Scroll down to Less Common Income
- Click Start on Miscellaneous Income, 1099-A, 1099-C
- Click Start on Cancellation of debt (Form 1099-C) and continue through the Interview questions.
Note: If you received a 1099-C for your main home and another 1099-C for something else (credit card, car loan, second mortgage, etc.) you won't be able to use TurboTax, as the interview doesn't support this.