Student Loan Discharge - Am I Insolvent?

Thanks , first of all for considering my question. I really need some insight here.

I was diagnosed with Stage 4 Melanoma last summer, after a disease-related accident (brain tumor caused). Anyway, I've been on Disability since 12/14 and after talking to my student loan servicer. I wanted to work out a loan rehab and IBR situation, bust she suggest I contact an organization called Nelnet first. They were supposed to put a hold on all collections, but that didn't happen and USAF (federal government) began garnishing my Disability this month (3/15). This wouldn't be a big deal as my oncologist is more than willing to sign my loan discharge forms. My concern is that it appears that when the loan is “forgiven” one must consider that loan amount as taxable income come tax time. The loan amounts (with penalties and interests) total around $13,000 (I have one loan in default and the other is in good standing under IBR). If the forgiven loan is counted as income then I am afraid I would lose my health benefits... as I receive $1,087 a month SSDI, which keeps me a couple thousand dollars under the threshold for healthcare.

Here's my question:

I've been reading about insolvency, and if you were insolvent before the loan was discharged, you woudn't have to claim it as income if you include Form 928 with your tax return. As I stated, I receive $1,087 a month in Disability benefits, but have no assets to speak of. I rent. Have some clothing. The laptop I'm typing on. Other cheap stuff. Nothing in my name. Would I be able to claim insolvency on next year's tax return if I'm in this financial condition before I woud discharge the loan? I don't have other debt so would the amount of the loan count toward insolvency? Any takers? Good grief, thanks for any help you can give me!

Chris