If I filed Chapter 7, but it isn't discharged until march of next year, do I report the discharged debt on the current year's tax return or next years?

ANSWER

Expert Charles Markham's Answer:

First off, debts discharged in a bankrupcty are not taxable and can probably go un-reported.  However, to be strictly correct you could include them on IRS Form 982.  You would NOT include discharged debts until they are actually discharged--things can happen in a BK.  So, you would wait until 2013 to address this on your taxes.

Charles Markham, EA

Massachusetts

20+ yrs experience

• Currently 5.0000/5 Stars.
• 1
• 2
• 3
• 4
• 5

15 Ans.