What information should be entered in Box 6 (Identifiable event code), and how is it determined?

Box 6 on Form 1099-C (Cancellation of Debt) requires an identifiable event code. This code tells the IRS the reason for the debt cancellation, helping determine whether the canceled amount must be reported as taxable income.

📌 Identifiable Event Codes for Form 1099-C

Each code in Box 6 corresponds to a specific cancellation event:

1. Code A – Bankruptcy: Debt canceled as part of a bankruptcy proceeding.

2. Code B – Identifiable Event: Debt canceled due to an identifiable event such as a foreclosure.

3. Code C – Expedited Charge-Off: Debt written off earlier than usual by the creditor.

4. Code D – Debt Discharge in a Settlement Agreement: Debt canceled as part of a settlement between debtor and creditor.

5. Code E – Debt Forgiveness: Debt reduced or forgiven through negotiation or agreement.

6. Code F – Government or IRS Discharge: Debt canceled by the IRS or another government agency.

🔎 How to Determine Which Code to Use

The correct identifiable event code depends on the nature of the debt cancellation:

• Bankruptcy → Use Code A

• Foreclosure or other identifiable event → Use Code B

• Creditor writes off debt early → Use Code C

• Settlement agreement → Use Code D

• Negotiated forgiveness or reduction → Use Code E

• Government agency discharge → Use Code F

📌 Why Accuracy Matters

Choosing the correct code ensures compliance with IRS requirements and avoids tax complications for both debtor and creditor. Each code corresponds to a different tax treatment, which can impact whether the canceled amount is taxable.

👉 For more details on debt reporting, see our guide on Form 1099-C instructions or explore our 1099 filing software to simplify IRS submissions.