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meffordtax
Level 1
February 28, 2025
Question

1095A - 1099C causing a large repayment

  • February 28, 2025
  • 2 replies
  • 7 views

I have a client that got a 1099-C form from a past due cancelation of debt. It was a significant amount and has caused a large repayment on the Premium tax credit. Since this was not actual income is there something I can do to avoid them having to pay this back.

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2 replies

IRonMaN
IRonMaN
Level 15
February 28, 2025

"Since this was not actual income"

Just curious.  If it isn't income, what is it?  

But you could have an out.  Was the client underwater with debt so that some or all of the debt could be excluded from unactual income?

Slava Ukraini!
    Just-Lisa-Now-
    Just-Lisa-Now-Intuit Community Champion
    Intuit Community Champion
    February 28, 2025

    Have you gone through the canceled debt worksheet to see if maybe Insolvency would help? 

    Theres an Insolvency worksheet in there that I have clients complete to see if maybe we can make some or all of it non-taxable.

    ♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
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