If a client receives a 1099-C for 2019 and then in 2020 actually pays off the debt, do you have to report it on the 2019 1040?

julie8 · ‎07-13-2020

Terry53029 · ‎07-19-2020

Should put cancelled debt as income (unless an exception applies) on 2019 taxes. If they paid the debt back in 2020 put the amount as other income with a negative amount with explanation on their 2020 taxes. Just curious, why did they pay it back if debt was forgiven?

If a client receives a 1099-C for 2019 and then in 2020 actually pays off the debt, do you have to report it on the 2019 1040?

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