@KuiPeR
The general procedure to report income as non-taxable when you receive a 1099, is to enter the 1099-MISC, and then enter a negative amount of offset income with an explanation. For example, if you receive a $5000 fire benefit payment, you would enter that, and then you would enter another item of -$5000 with an explanation like “adjustment for tax-free fire benefit payment.”
The adjustment process is already included in TurboTax. So the only thing you need to do is take your original tax return where you added the income, and amend it to leave the income alone and add the negative adjustment.
