Two different issues.
The $1200 check is easy. If you deducted your mortgage interest on schedule A way back when, the check is a "taxable recovery" which is another term for a reimbursement of a previous deduction. If you deducted the interest before, the reimbursement is taxable now. You would enter it as a taxable recovery which is found in the uncommon income section.
The canceled debt is slightly trickier but not too bad.
If you borrowed money, and never paid it back, that is taxable income to you. There is an exception if the debt was the mortgage on your personal residence, your main home where you lived most of the time. (If this was some other kind of debt, we have to get into a complicated discussion about the statute of limitations and how the IRS changed the regulations on when the bank was required to issue a 1099, and what the regulations were 11 years ago. Fortunately we can ignore all that.)
You have two options, more or less.
1. Report the 1099-C now in turbotax, and go through the interview to indicate it was a canceled debt on your principle residence. It should end up being non-taxable.
2. Leave the 1099-C off your return. You will probably get a letter from the IRS in a few months assessing income tax on that income that you did not report. You would answer with a letter explaining the circumstance, the time frame, and that the debt is excluded from income since it was your main home. You should include copies of documents from the bankruptcy. If you don't have documents, you can rely on the age of the transaction and the statute of limitations and explain that you just don't have 11 year old proof any more.
Where you could run into trouble is if the date of the "identifiable event" in box 1 is recent. That's supposed to be the date of some event that the bank used to determine the debt was not collectible. They are not supposed to use today's date if they are just cleaning up their books from 11 years ago. But if they did, it will require more proof from you to show the IRS that the event really occurred 11 years ago.
Good luck.
