Taxes on mortgage forgiveness? (foreclosure, debt, short sales, bank)

[JayTea]

My bank approved under HAMP program to allow me to stay in my home instead of foreclosure with a 3 month trial. However, they said there may be tax consequences because they will send IRS a 1099. They forgave $70K. How much will I have to pay in tax? Has the mortgage relief act expired?

[2bindenver]

Mortgage Debt Rellief Act of 2007 The Mortgage Forgiveness Debt Relief Act and Debt Cancellation

Congressional inaction on debt forgiveness bill affects short sales - LA Times