You need to enter the 1099-MISC as follows, but you also need to know what the settlement paid.
If it paid back wages, it's taxable.
If medical injures, it is not taxable (also those medical expenses paid would not be eligible as deductions on your Schedule A)
Enter the 1099-MISC
Under Income
Other Common Income
Income from 1099-MISC
The amount should be reported in Box 3
On the screen that asks "Does one of these uncommon situations apply? click "This was money from a lawsuit settlement"
Next select if any was for back wages and continue
The program will not ask about Schedule C.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
