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.
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.
To enter your 1099-C:
- Open (continue) your return, if it's not already open.
- In the TurboTax program, search for 1099-C or 1099C (lower-case also works) and then click or tap the "Jump to" link in the search results.
- Select the type of cancelled debt (main home or other) and then click or tap Continue.
- If using Free Edition, follow the prompts to upgrade to Deluxe.
- Follow the onscreen instructions to enter information from your 1099-C.