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FAQ / What if I am insolvent?A taxpayer is insolvent when his or her total liabilities exceed his or her total assets. The forgiven debt may be excluded as income under the "insolvency" exclusion. Normally, a taxpayer is not required to include forgiven debts in income to the extent that the taxpayer is insolvent. The forgiven debt may also qualify for exclusion if the debt was discharged in a Title 11 bankruptcy proceeding or if the debt is qualified farm indebtedness or qualified real property business indebtedness. If you believe you qualify for any of these exceptions, see the instructions for Form 982. For more information, see highlights of the Mortgage Forgiveness Debt Relief Act. |
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NewsDecember 5, 23Taxpayer Beats IRS in Landmark Case on foreign bank reporting for dual residents Read More » December 4, 23 MO woman spends 5 years trying to get her nameless grandson a name and a birth certificate Read More » November 30, 23 New York enacts clean slate legislation for old criminal records Read More » November 29, 23 Russian soldier forges death certificate to dodge Ukraine War Read More » |