Jim-from-Ohio
Level 11
Level 11
‎02-06-2024 06:14 PM

I know there are a number of exceptions where you can exclude canceled debt from income.. as far as this one: 

  1. Cancellation of qualified real property business indebtedness

Do you think a rental property that an indvidual owned qualfies?  I did research but came away not sure if it qualifies. thank you. 

0 Cheers
PATAX
Level 15
‎02-07-2024 06:50 AM

Jim, this is a rare situation. I am not sure of answer. I found 10/15/2021 article by prioritycommerce.com called "Cancellation of Debt on Rental Property". Google this. Article is over two years old, so I am not sure if relevant law has changed or not, or if this article is definitive and applies to your client. Hope this helps.

Jim-from-Ohio
Level 11
Level 11
‎02-07-2024 07:28 AM

thanks.. I got through it.. we were able to exclude some of the 1099-C amount!