enthusiaction
Junior Member
What is the name of your state (only U.S. law)? Washington
I received a 1099-C for a cancelled debt. I understand I might be able to avoid paying tax on the amount if I am considered insolvent. My debts are easily triple my assets on the date of the cancellation, but my wife and I file a joint return and her assets far exceed my debt.
Can I still use the insolvent defense, since my debts are triple my assests, or will her assets have to be included on form 982? It would effectively kill my chances of avoiding taxes on the cancelled debt if her assets have to be included.
What's the best course of action here? Thanks!
I received a 1099-C for a cancelled debt. I understand I might be able to avoid paying tax on the amount if I am considered insolvent. My debts are easily triple my assets on the date of the cancellation, but my wife and I file a joint return and her assets far exceed my debt.
Can I still use the insolvent defense, since my debts are triple my assests, or will her assets have to be included on form 982? It would effectively kill my chances of avoiding taxes on the cancelled debt if her assets have to be included.
What's the best course of action here? Thanks!