Yes, settlement for wrongful termination is taxable income.
See Are legal settlements taxable?
https://ttlc.intuit.com/questions/2899059-are-legal-settlements-taxable
To report a lawsuit settlement in TurboTax:
- Click My Account (Top right of your screen).
- Select Tools.
- In the pop up window, select Topic Search.
- In the search bar, type in lawsuit settlement.
- Highlight it and select GO, and follow the prompts.
