Answer No to the taxable attorney fees. It doesn't need to go on Schedule C as you have the W-2 for the employment portion of it. The 1099 amount for non-wage income is taxable to you, but it is not self-employment. When you go through the 1099-entries in the Other Common Income section, you have to answer the questions so TurboTax does not enter this as self-employment. It should be reported on Line 8, Other Income on Form 1040.
To enter a 1099-MISC in TurboTax:
- Open or continue your return, if you're not already in it.
- Search for 1099-misc and select the Jump-to link.
- Answer Yes to Did you get a 1099-MISC?
- If you already entered a 1099-MISC, you'll be on the 1099-MISC Summary screen, in which case select Add Another 1099-MISC.
- If you need to edit or delete a previously-entered 1099-MISC, select the appropriate button.
- Enter the info from your form into the corresponding boxes.
In the series of follow-up questions, indicate it was a settlement and answer Yes to the back wages questions. Enter the amount from Form 1099 (should be the portion of your check that was not on the W-2) and the income will go to Line 8.
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