A discharge of indebtedness in a Title 11 case refers to a discharge of indebtedness that occurs in bankruptcy proceedings. In a Title 11 case, the discharge of indebtedness is typically granted by the bankruptcy court and is binding on all creditors. A discharge of indebtedness that is not in a Title 11 case may be the result of a variety of circumstances, such as a settlement or a foreclosure. The tax treatment of a discharge of indebtedness may be different depending on whether it is in a Title 11 case or not.