Tax
Jun. 12, 2023
Your debt was canceled, but now you have taxable income
There are exceptions. Before 2021, student debt cancellation was generally considered a form of income, and therefore taxable both at the federal and usually state level. That’s since changed.
Robert W. Wood
Managing Partner
Wood LLP
333 Sacramento St
San Francisco , California 94111-3601
Phone: (415) 834-0113
Fax: (415) 789-4540
Email: wood@WoodLLP.com
Univ of Chicago Law School
Wood is a tax lawyer at Wood LLP, and often advises lawyers and litigants about tax issues.
Most people know that if they receive cash, it is probably taxable unless it is an honest to goodness gift. Most people know that if they receive property, that the property is probably also taxed, again, unless it is a true gift. (More about gifts below.) But how about what happens if it doesn’t really seem that you got anything? Say your uncle loaned you money, and then says don’t worry about paying me back? Can that somehow be taxed?
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