I received a lump-sum payment as a result of LTD lawsuit settlement. My Short Term and Long Term monthly payments before the settlement were tax-free since disability insurance payments were after-tax on my monthly paycheck. The issuer( an insurance company) of the lump-sump payment, issued a 1099-MISC with Box 3 containing the settlement amount and all the other boxes blank. I called the issuer requesting to send me a W2 for my settlement since I consider this lump sum payment as replacement for my future LTD monthly payments which should be tax-free. The issuer refused this. I think i don,t have any other option but to enter 1099-MISC into Turbobax for 2020 tax return and still believe that this should not be taxable. Is there any way to indicate this to IRS that this is 1099-MISC income should not be taxable? Also anyone know how to do this Turbotax online?
