Turbotax incorrectly listed the income type on Schedule 1 from my 1099-NEC.

SkyPilot · ‎March 16, 2026

I had a 1099-NEC and a 1099-MISC on my return this year. When TurboTax listed the income types for both of these on line Z of Schedule 1, it listed the Income Type for my 1099-NEC as "Settlement Income from 1099-MISC". Also, it listed the Income Type for my 1099-MISC as "Other Income from box 3 of 1099-MISC".

The 1099-MISC should be "Settlement Income from box 3 of 1099-MISC" and the 1099-NEC should be "Other Income from box 1 of 1099-NEC".

The first line, with the amount of $1,554, is from a 1099-MISC that is from a Class Action Lawsuit settlement. The income amount is listed in Box 3 of the form and identified as Other Income, not from back wages.

The second line, with the amount of $1,454, is from a 1099-NEC. The income amount is listed in Box 1 of the form. It is from the fair market value of items received from Best Buy TIN and/or Amazon Vine for posting reviews on their website. This should not be identified as "Settlement Income".

PatriciaV

Your best option is to review your entries to be sure they were input correctly. Or you can delete them and try again. Since both are "Other Income" on Schedule 1 and correctly identify the source forms, the actual descriptions aren't material to your tax return.

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SkyPilot

Yes, they were entered correctly. I see each of the entries the first as a 1099-MISC and the second as a 1099-NEC. I have removed them and reentered them and it gives me the same result.

I understand that the description isn't material to the Tax Return, because electronically they are looking at the total dollar amounts. But, the second line says it is Settlement Income from a 1099-MISC, which it is surely not. Settlement Income from a Lawsuit can be taxed differently if it is from back wages. The second line is Other Income from a 1099-NEC.

Personally as a IT Project Manager for 40+ years, it is still a bug and I would think TurboTax would want to fix it. If I get audited, I will need to explain it by saying it is a software bug.