Are funds from a litigation settlement taxable? We received checks from Facebook as a result of a settlement between the State of Illinois and Facebook

[oldradio99]

This money was based on a court case between the State of Illinois and Facebook in a California Court

[DaveF1006]

Yes, according to the Internal Revenue Code (IRC) Section 61, all income is taxable from whatever source derived, unless exempted by by IRC Section 104. Please view this link for the list of exclusions.

[oldradio99]

Link to exclusion is not working

[DianeW777]

Here's a information that describes settlements that aren't taxable and other information.

• Are legal settlements taxable?
• Where do I enter the award for a taxable legal settlement?

[aetos921]

How is the $397 Facebook settlement reported in my HR Tax Cut program? I never received anything in the mail for tax reporting but want to make sure to include it.

[tataia]

I guess under 1099-misc but unclear at this point