Go back and review your 1099-MISC entry. Make sure you told TurboTax the money came from a legal settlement. That will remove the business questions on California Form 3514.
- Sign in to TurboTax and open or continue your return
- Search for 1099-misc and select the Jump to link
- On "1099-MISC Summary" tap EDIT
- Skip "Let's get the info from your 1099-MISC
- On "Describe the reason for this 1099-MISC" skip if your description is correct
- On "Does one of these uncommon situations apply?" select This was money from a lawsuit settlement
See Where do I enter an award from a taxable legal settlement?
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