to what extent is that cancelled in a personal bankruptcy ta

to what extent is that cancelled in a personal bankruptcy taxable as cancellation of debt income

Solution

The debt cancelled in a personal bankruptcy is not taxable at all as \"cancellation of debt\" income , as far as the IRS concerned.

=> When we file bankruptcy and the debt is discharged or wiped out, it is not treated as income in the IRS\'s eyes. You just have to report the bankruptcy filing on your return on the year you filed the bankruptcy and the debt cancelled cannot be considered income.