Enter your W-2 as shown.
When you enter your 1099-Misc, you can indicate it is a lawsuit settlement, so it isn't counted as 'self-employment' income for Schedule C.
Then, in Wages & Income, scroll down the topic list to the very last item, 'Miscellaneous Income, 1099-A, 1099-C'.
On the next page, scroll all the way down to 'Other Reportable Income'.
Under 'Other Taxable Income' enter a description of Lawsuit Settlement Adjustment and the amount on your 1099-Misc as a negative amount.
@cammsp
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