1099-c mortgage forgiveness act

cody
cody Member Posts: 1 Newcomer
edited February 13 in Filing my taxes

I received a 1099c for my only home that I bought 15 years ago, it was repoed and sold. i got it 12-25-25 I have never owned another home and it was the original loan. I think I may be able to write off this 12000 canceled debt with the mortgage forgiveness act right?

i'm insolvent for about half of it but from what I'm reading shouldn't I just be able to forgive it all being it's my first home with the forgiveness act?

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Answers

  • JohnV
    JohnV FreeTaxUSA Agent Posts: 28 image
    Hello Cody - The Mortgage Forgiveness Debt Relief Act of 2007 was extended to December 31, 2025. This allows you to exclude income from the discharge of debt on your principal residence. If this 1099-C is from your primary residence debt discharge, then you qualify to exclude from income, without having to determine whether you are insolvent or not.

    If the debt discharge is not from your primary residence, then the IRS provides more reasons on whether the cancellation of debt can be excluded from income here: https://www.irs.gov/newsroom/home-foreclosure-and-debt-cancellation

    You will have to include Form 982 with your tax return to claim the exclusion from income for the cancellation of debt.

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