I received a lump sum from SS disability which included amounts from 2020 and 2021. For both years, am I able to only be taxed on the 85% of our gross income?

It depends, you must include the taxable part of a lump-sum payment of benefits received in the current year (reported to you on Form SSA-1099, Social Security Benefit Statement) income, even if the payment includes benefits for an earlier year.

However, there are a couple of ways to determine the amount of income to include.

TurboTax will guide you to ensure you are getting the best outcome possible. But you will need some information from your 2020 and 2021 filed tax returns and 2020 and 2021 SSA-1099's. Once you have collected those documents, log in to TurboTax and follow the guided questions to enter your lump-sum SS benefit amounts. 

1. Open (continue) your return in TurboTax
2. In the search bar, search for the term Social Security benefits and then select the Jump to link at the top of your search results
3. On the screen Did you receive Social Security or Railroad Retirement benefits in 20XX? answer Yes and select Continue
4. On the next screen, check the box beside Social Security benefits (Form SSA-1099), then enter the amounts from your form(s) in the boxes provided
5. When you get to the screen "Did you receive any lump-sum payments?" answer "yes".
6. For "What year was the lump-sum payment for?" enter 2021. The program will guide you to enter each year separately  

For the next steps, you will need the info from 2020 and 2021 tax returns and SSA-1099 forms. Entering this info will help TurboTax determine how it will be taxed.

After you enter your lump-sum Social Security payment information, TurboTax will automatically figure out what, if any, taxes you owe due to the lump-sum payment.