D
doncopeland
Guest
My grandmother passed away,and she held a note on a loan for me to open a business. We were paying 6% interest. She annually forgave us the payments which did not exceed $10,000.00 so she did not have to pay gift tax. Now that she has passed, the loan has been forgiven. Since the debt is now part of the estate and I am the only heir, and the only one named in her will, does the balance of the forgiven debt become taxable income or does it now come under estate tax law?