HELP!!! I owned farm property in North Dakota with my former spouse (but currently reside in Arizona). In the Divorce Decree, I was awarded the marital residence, but also incurred the debt associated with it. At the current time, I decided to rent out the property, and as such, have incurred rental income and interest from the renter. The property was later foreclosed on due to lack of payment.
I received a "Cancellation of Debt" (Tax Form 1099-C) from the Mortgage company, reporting approximately $128,000 of debt that was cancelled (in box #2). It also states that approx. $23,000 of that amount was interest (in box #3).
My question is whether or not the $128,000 has to be reported as income on my taxes. If not, what schedule for 1040 do I need to use?
I received a "Cancellation of Debt" (Tax Form 1099-C) from the Mortgage company, reporting approximately $128,000 of debt that was cancelled (in box #2). It also states that approx. $23,000 of that amount was interest (in box #3).
My question is whether or not the $128,000 has to be reported as income on my taxes. If not, what schedule for 1040 do I need to use?
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