Question

Is cancellation of debt taxable income alabama

Forum|Forum|7 years ago
June 5, 2019
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Do I report a 1099-C on my Alabama tax return

TurboTax Deluxe Online

Employee

Yes, if your 1099-C is taxable for federal, it is also taxable in Alabama. Alabama follows federal income unless they specifically exclude a type of income.

You can see income exclusions here at the state website: https://revenue.alabama.gov/individual-corporate/taxes-administered-by-individual-corporate-income-t...

Note: if your liabilities are greater than your assets, you are considered insolvent and do not need to report your 1099-C, even if it would otherwise be taxable. Be sure to complete the worksheet on page 6 to determine if you are insolvent and to keep for your records: https://www.irs.gov/pub/irs-pdf/p4681.pdf