Do you have to pay taxes for debt you got wiped out with debt negotiation?

i read that if you saved more than $800, or something like that, with debt negotiation, that it gets reported to the IRS and youre liable for paying taxes on it. is this true? if it is, whats the benefit, then, of doing the negotiation if youre going to have to pay 30%, or so, on taxes? i dont get it...