1099-nec

[rhayky01]

I received a 1099-nec forca lawsuit settlement. Wasnt for wages it was just to drop the suit. Turbo tax keeps saying it doesnt know what form to link it to sonwont let me enter it. Talked tirbo tax and they said must be a bug and call irs. Thats no help for a program o paid for. Any help

[ee-ea]

This applies to Form 1099-NEC, 1099-K, 1099-Misc et al and to other taxable income without a report.

Enter it in the personal section, Other Common Income Form 1099-MISC.  To ensure it does not go to Schedule C (self-employment), you will answer the follow-up questions accordingly. 

On the Describe the reason for this 1099-MISC screen, enter a description of the other income. (suit settlement)

Select None of these apply on the Does one of these uncommon situations apply? screen.

Select No, it didn’t involve work like my day job on the Did the involve work that's like your main job? screen.

Select I got it ONLY in 2023 on the How often did you get income for? screen.

Select No, it didn’t involve intent to earn money on the Did the work involve an intent to earn money? screen.

Answering differently to any of these questions will imply self-employment and generate Schedule C.  

Please give feedback. If this helps click “Thumb” or “Best Answer” if it’s a solution.

[DawnC]

Delete your entry and re-enter it.   Give a description and on the follow-up screen that asks about uncommon situations, choose this money was from a lawsuit settlement.   When the dropdown question appears (was it for back wages) answer YES (even though the answer is NO)  and then enter $0 as the amount of back wages.  

The other option is to use the sporadic or hobby income selection.   Either one of these options will put the income on Line 8z of Schedule 1.  

[rhayky01]

Thanks , worked liked a champ. Turbo tax support was no help but your answer worked grat