Legal settlements that are taxable (including previously deducted medical expenses related to physical injury or illness) are entered as miscellaneous (other) income.
Interest earned on settlements is taxable income and should be entered as a Form 1099-INT.
If you didn’t receive a 1099-MISC, follow these steps to report the income:
- Sign in to TurboTax and open or continue your return
- Search for lawsuit settlement and select the Jump to link
- Answer Yes to the question Any Other Taxable Income?
- If you've already entered miscellaneous income, select Add Another Miscellaneous Income Item
- Enter a brief description and the amount you received and select Continue
Related Information:
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
