Is cancellation of debt income taxable in PA?

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    Pennsylvania does conform to Federal law pursuant to the Mortgage Debt Relief Act of 2007.  Cancellation of debt that involves a primary residence will not be considered taxable by PA.   However, cancellation of debt for other situations such as credit card debt is not entirely clear. Cancellation of debt for Business or Commercial activity IS taxable in PA.  This writer tested several cancellation of debt entries in Turbo Tax, to include a home mortgage cancellation of debt and credit card cancellation of debt.   No PA income tax for either cancelled debt.  Hope that helps.
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