Thank you, and as i suspected, the beneficiaries are responsible for reporting the cancellation of debt income. My question now, is it my responsibility to hunt them down? or will the IRS inform them? I have lost track of 2 of them (it has been 2 years). Also, do i just send a copy of the 1099-C to them and they can report their respective percentages? Will the IRS even understand that? (my grandmothers social security number is on the 1099). Sorry, I am not a tax person and I am lost here. I wasn't a beneficiary myself and i am not sure if i have any responsibilities after filing that last 1041. I am wondering if i should just let the IRS do the leg work here.