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Submitted By: JL
Answered: July 16, 2013 8:30 am
Answered: July 16, 2013 8:30 am
Is all credit card debt that’s forgiven taxable?
Yes, if the credit card borrowing is for consumer purchases. There is no exemption from cancellation of debt (COD) income for personal borrowing other than a home mortgage if forgiveness is completed before the end of this year.
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Tax Glossary
Tax deferral
Shifting income to a later year, such as where you defer taxable interest to the following year by purchasing a T-bill or savings certificate maturing after the end of the current year. Investments in qualified retirement plans provide tax deferral.
