1040-US: Screen 1099C amounts reported on Form 982

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Question

Are any amounts entered in Screen 1099C reported on Form 982?

Answer

Yes. In Screen 1099C, if the Reason Box 2 amount is excluded from gross income field contains any of the following codes and all or some of the canceled debt is excluded from income, the excluded amount will be reported on Form 982, line 2.

Code Description
6 Title 11 bankruptcy
7 Insolvency
8 Qualified farm debt
9 Qualified real property debt
10 Qualified principal residence debt

You can exclude all or some of the canceled debt by entering X in the Exclude 100% of canceled debt from income field or entering an amount in the Box 2 amount excluded from gross income, if not 100% field.

When excluding canceled debt from income, there must be a reduction of tax attributes on Form 982. On Screen 982, enter the amount of debt being excluded that applies to the available tax attributes in the Reduction of Tax Attributes data entry section, Excluded Gross Income column.

Note: The Total amount of discharged indebtedness excluded from gross income (Force) field in Screen 982 will overwrite any amount of canceled debt entered on Screen 1099C.

Related topic: Form 1099-C - Cancellation of debt FAQs (1040)

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