I received a breakdown of what settlement funds were allocated for lost wages and what funds were for emotional distress. I received one check that was taxed already for lost wages and a larger second check for emotional distress punitive damages with a breakdown of 20% towards lost wages and 80% for the punitive damages. How do I enter this information on my taxes. I received the payment in January of 2025 but the case was concluded in December of 2024. I am trying to figure out what to pay in to the IRS for taxes on the money received.
Thank you!
