Is This True???????

[DebtSlave]

I heard it mentioned in conversation over the holidaze..that after discharge, any debts which are written off are subject to income tax ?
I have never heard this before.

Total debt 79K
Claims submitted by creditors 27K

Would I actually have to report 52K as income during the year the Chapter 13 (oldLaw) is completed???
Please say it ain't so !

[keepmine]

It ain't so!

[wayne-o]

if you had negotiated settlements for these debts any amount over $600 would be taxable, but since they were discharged in bk the amount is not taxable.

[chpxiii]

Any debt discharged in a bankruptcy is not subject to income tax.

[Flamingo]

I heard it mentioned in conversation over the holidaze..that after discharge, any debts which are written off are subject to income tax ?
I have never heard this before.

Total debt 79K
Claims submitted by creditors 27K

Would I actually have to report 52K as income during the year the Chapter 13 (oldLaw) is completed???
Please say it ain't so !

Debts listed and discharged in a bankruptcy - no; debts that are negotiated with the creditor and a portion "forgiven" - yes. The "forgiven" portion is considered income in the year forgiven and many are suprised when the 1099 arrives in the mail listing the forgiven amount that has to be claimed as income for that tax year.

[DebtSlave]

Thank you for your response and Happy New Year to all !