If your client is insolvent of course you can, but be sure he/she is. some student loans are exempt. From IRS. Be sure you get paid up front.

Exceptions to cancellation of debt income:

1. Amounts canceled as gifts, bequests, devises, or inheritances
2. Certain qualified student loans containing loan provisions for cancellation based on length of employment in certain professions for a broad class of employers
3. Certain student loan discharges after December 31, 2020, and before January 1, 2026
4. Amounts received or forgiven under certain student loan repayment assistance programs
5. Amounts of canceled debt that would be deductible if you, as a cash basis taxpayer, had paid it
6. A qualified purchase price reduction given by the seller of property to the buyer

Amounts that meet the requirements for any of the following exclusions aren't included in income, even though they're cancellation of debt income.

How do I exclude it? 

The Canceled Debt Worksheet (QZ button at the bottom of the 1099C worksheet) has a section for Insolvency

ARPA does say canceled student debt is not taxable income until 1/1/26, but I'm not sure if Discover actually forgave its student loans.  I posted links yesterday with articles from Discover and Sallie Mae but that posting was deleted. I guess links are not permitted.

I plan to except the 1099C income from taxes but the clients will need research whether Discover's sale to Firstmark actually canceled their student loans.