Change to requirements for excluding principal residence indebtedness discharged in 2017

The Bipartisan Budget Act of 2018 removed a requirement for excluding principal residence indebtedness discharged in 2017. For 2017, discharges of principal residence indebtedness, line 1e of Form 982, may be checked even if the discharge was not subject to an arrangement that was entered into and evidenced in writing before January 1, 2017.

The Act also changed a requirement for excluding principal residence indebtedness discharged in 2018 that may affect next year's tax return. In order to exclude principal residence indebtedness discharged in 2018, the 2018 discharge must be subject to arrangement that was entered into and evidenced in writing before January 1, 2018.