The two responses received when this question was first posed, are not consistent about how to handle the settlement check received because a company was considered to have misrepresented the value of its stock when it purchase another company (in which I had stock) and transferred the stock shares to the new owner. A class action suit was subsequently filed. Last year (2023) that company itself was purchased and taken private. My net sales in 2023 for shares transferred in 2017 resulted in a capital loss. That was reported on 2023 taxes. However, in May 2024, a class action settlement check was distributed to all those affected by the original stock transfer. So the loss in 2023 was a real loss and reported as such. My question is what is the impact of the 2024 claim settlement check. I understand it is income and, as such, taxable. But does is require that I amend 2023 submission and, if so, how. Or do I handle the 2024 check simply at 2024 income without a 1099 form, since the settlement company has already indicated it will not send such forms? Surely someone has had this issue before and there is some tax liability accurate answer and procedure.
