Category Archives: Cancellation of Debt (COD) income

Proposed Regs Clarify Application of the Insolvency Exception to Trust Discharge of Debt Income

The Treasury Department has finally issued proposed regulations that provide some clarity for grantor trusts saddled with cancellation of debt (“COD”) income. Under the proposed regulations, if a grantor trust has COD income, the grantor’s—and not the trust’s—solvency is relevant … Continue reading

Posted in Cancellation of Debt (COD) income, Insolvency exception, Life insurance trusts, Treasury Dept. Regulations | Tagged , , , , | 2 Comments