The hospital foundation considered my aid application and decided to forgive the entire amount. On my tax return for next year, will I have to count that as income?
2007-05-24 23:36:13 · 6 answers · asked by mellow yellow 1 in Business & Finance ➔ Taxes ➔ United States
Under other circumstances, you would potentially include a forgiveness of debt as income. However, since had you paid the debt, it would have resulted in a deduction to you (medical expenses on Schedule A), the cancellation of debt is not considered income to you, to the amount that paying the liability would have resulted in a deduction. Schedule A medical expenses must be more than 7.5% of your Adjusted gross income, so keep that in mind.
In the event they issue you a 1099, check with the foundation to see if they can issue a corrected 1099 that shows $0. They should be aware of this rule already though, as I'm certain you're not the first one that they have forgiven a debt for. If they are unable to for their own reasons, check with an adviser about how to offset the income with deductions, as it shouldn't be included in your income.
Hope this helps!
2007-05-25 01:38:21 · answer #1 · answered by starlight_chic06 3 · 3⤊ 2⤋
Hell yeah thats suited, those men make an insane quantity of money. between the heirs to considered one of those oil barron kinfolk, is alreday properly worth $a million billion, and all he does is occasion and take drugs all day. Its extra valuable all that loose money (its in contrast to those oil barrons artwork for it) pass into helping anybody than into the wallet of those egocentric and grasping barrons. the only reason those men could make money is via the secure practices and infrastructure that the government supplies. as a fashion to do this the government desires money. The republican answer to that's to borrow money from China, Saudi Arabia (and the different non-friendly usa with extra money) and pay them lower back vast quantities of interest. The democratc answer is to tax anybody a honest quantity, meaning the wealthier human beings pay slightly greater cost. in the event that they didnt, then the two the roads and bridegs might fall, squaddies and cops does not gets a commission, faculties might close down and so on, and so on. OR the middle type (an identical center type which contributes the main in taxes) may well be talked approximately as directly to pay much extra. If its a call between those grasping oil barrons or the consumer-friendly american paying extra taxes, then I easily think of it prudent to tax the wealthy barrons extra.
2016-11-05 08:19:42 · answer #2 · answered by ? 4 · 0⤊ 0⤋
Potentially, yes. Debt that are forgiven outside of a bankrupcy or insolvency should be including in income. You will receive a 1099 from the foundation if you are to include it.
IRC Sec 61(a) and Sec 108(a)
2007-05-24 23:51:52 · answer #3 · answered by extra_37 4 · 4⤊ 3⤋
Only if you receive a 1099
2007-05-25 03:43:18 · answer #4 · answered by T H 4 · 0⤊ 5⤋
No- it was all ready earned and taxed when you earned it.
Hopefully, you file your taxes every year.
If it is money you haven't earned yet to pay the bill- just carry on as you do.
You just can't say that you have 28K in medical bills unless you actually owe that amount.
2007-05-24 23:40:01 · answer #5 · answered by gawd0 5 · 2⤊ 6⤋
No.
2007-05-25 03:42:02 · answer #6 · answered by acmeraven 7 · 0⤊ 4⤋