Form 1099-C

Form 1099-C is a tax document used in the United States to report the cancellation of debt. When a lender forgives or cancels a debt of $600 or more, they must issue this form to both the borrower and the IRS. The borrower may need to report this canceled debt as income on their tax return, as it can affect their taxable income. It's important for recipients to understand the implications for their taxes, as canceled debts could lead to owing taxes on that amount, unless certain exemptions apply.