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Vineland, NJ |

I went to do my taxes...I have a 1099-A and the FMV is 110,000 and I owed 179,000...I did a deed in lieu of foreclosure...Is my debt canceled? The Hand R Block professional believes so...Just have to put it on the return...I also went bankrupt 3 years ago and did and abandonment of I covered?? Confused

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The Form 1099 is used by creditors to report forgiven debt to the IRS because as a general rule forgiven debt is taxable as income. However, there is one and possibly a second exception that will excuse you from reporting it. Your H&R Block "professional" is sadly misinformed. Find IRS Form 982 (available online at and read the instructions.

Best wishes for a favorable outcome, and please remember to designate a best answer.

This answer is offered as a public service for general information only and may not be relied upon as legal advice.

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In addition to Ms. Sinclair's answer your obligation was discharged in the bankruptcy, therefore under the Internal Revenue Code, Section 108, is not a taxable event. You need to talk with a good CPA to make certain you properly address this matter.

This firm is in the business of helping people and companies file for bankruptcy protection. Therefore, the bankruptcy code requires that we call our firm a "debt relief agency." This information is provided for general information purposes only and is not intended to be a legal opinion, legal advice or a complete discussion of the related issues. Nor is this advice intended to create a client - attorney relationship. Every individual's factual situation is different and you should seek independent legal advice from an attorney familiar with the laws of your state or locality regarding specific information.

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