The part of the settlement that is for loss of rent is taxable. Report this portion of the settlement as rental income for the rental property.
If the portion for property damage is less than your adjusted basis in the property, it is not taxable and does not need to be reported on your tax return. The part of the settlement for property damage that exceeds the adjusted basis of the damaged property, if any, is taxable as a capital gain. Report it in the section at Federal>>Income & Expenses>>Other Business Situations>>Sale of Business Property.
Refer to IRS Publication 525 at this link for the rules on taxable and nontaxable income.
and I think the response assumes you received the cash for the judgement, which isn't clear from the question.