Your client JoJo was asset-rich but cash-poor i.e., her assets were of the illiquid kind and couldnt readily be sold or otherwise converted to cash. So her creditors forced her into bankruptcy court last year, where a total of $200,000 of her debts ended up being discharged.

To be clear, JoJo was never insolvent. The value of her total assets always ex-ceeded her liabilities she just couldnt pay her bills as they came due in the ordinary course for lack of cash.

JoJo brings you, her CPA and return preparer, the Forms 1099-C (Cancellation of Debt)*** that she and the IRS had received from her former creditors. Your advice as to what, if anything, to report about all of this on her tax return?