FINRA Settlement from IRA Account going back to IRA Account

I have a FINRA settlement for money lost from IRA account that was not managed correctly.

The settlement was paid almost evenly to my IRA, my wife's IRA, and our lawyer for legal fees. The money was immediately put in the IRA accounts as instructed.

I received only the 1009-MISC for the the full amount in my name. I am told by my investment advisor and lawyer, that since I put back into IRA this should not be taxable. The CPA from the Financial Advisor said I need to offset this same amount, and I should be fine.

In speaking with a Turbotax Advisor for an hour, they agree that this should not be taxable but not sure how to do this. As when I put the amount back into the IRA contribution, it says that I exceed the limits for the year. As this is more like a rollover than anything, as this money was already mine and at an extreme loss; even after settlement.

posted