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How do I enter a settlement from a class action lawsuit

molly-ferris — Fri, 07 Jun 2019 22:37:29 GMT

Legal settlements are reported as "Other Taxable Income."...

IreneS — Fri, 07 Jun 2019 22:37:31 GMT

Legal settlements are reported as "Other Taxable Income."

You may or may not receive a 1099-MISC reporting the income. Regardless, this is how you should enter it in TurboTax:

Click on Federal Taxes > Wages & Income [In TT Self-Employed: Personal > Personal Income].
Scroll down to the Other Common Income section and click on the Start/Update box next to Income from Form 1099-Misc. [See Screenshot #1, below.]
If you previously entered a 1099-Misc. in your return, you will be brought to the 1099-Misc Summary page. Click on the Add Another 1099-Misc. box to add a new form [or Edit to change an existing form]. [Screenshot #2]
If you haven't already entered a 1099-Misc, answer Yes to the question Did you get a 1099-MISC? (even if you didn't get one).
On the Let's get the info from your 1099-MISC screen, complete the top part and then enter the award amount in Box 3 Other Income. [Screenshot #3]
Fill out any other boxes from your paper 1099-MISC (if you have one), then click Continue.
Enter a reason for the 1099-Misc. [Screenshot #4]
On the screen, Does one of these uncommon situations apply? select This was money from a lawsuit settlement and then answer the back wages question before clicking Continue. [Screenshot #5]

For the payers name do I put the lawfirm that represented...

MorningSleeper — Fri, 07 Jun 2019 22:37:32 GMT

For the payers name do I put the lawfirm that represented the class and mailed the check or the company the suit was against and settled/paid?

Put the payer's name that appears on the 1099-MISC so tha...

IreneS — Fri, 07 Jun 2019 22:37:34 GMT

Put the payer's name that appears on the 1099-MISC so that the IRS can match it up with their copy.

I did not get any 1099-MISC

MorningSleeper — Fri, 07 Jun 2019 22:37:35 GMT

I did not get any 1099-MISC

Then enter the name of the company who was the subject of...

IreneS — Fri, 07 Jun 2019 22:37:38 GMT

Then enter the name of the company who was the subject of the lawsuit.

Ok thanks.

MorningSleeper — Fri, 07 Jun 2019 22:37:39 GMT

Ok thanks.

No 1099-MISC received. Did the steps above but keeps aski...

hyde6062 — Fri, 07 Jun 2019 22:37:41 GMT

No 1099-MISC received. Did the steps above but keeps asking for EIN number. what now?

I received a W2 for 2018, problem is with city of Lansing...

rahughey1 — Fri, 07 Jun 2019 22:37:43 GMT

I received a W2 for 2018, problem is with city of Lansing MI taxes, the company is a Lansing based employer, but I did not work in Lansing in 2018, I am a retiree

Most class action lawsuit settlements do not send a 1099-...

MorningSleeper — Mon, 21 Feb 2022 20:40:37 GMT

Most class action lawsuit settlements do not send a 1099-MISC, if you did not receive one and follow this answer, it will show a red exclamation point error, asking for EIN or SSN which one is not going to have if they don't send a 1099-MISC.

To resolve, follow instructions in following answer.

https://ttlc.intuit.com/questions/4324380-i-recieved-a-class-action-lawsuit-settlement-from-fedex-corp-in-the-aount-of-17899-62-the-lawyers-got-7474-19-and-i-got-10445-79-what-am-i-responible-for

Basically type in lawsuit settlement in search box, then Jump to lawsuit settlement link in box that pops up and fill in the info. The info entered carries over to your schedule 1 line 21 and then 1040 line 6 just like this method but no errors.

MyRe: How do I enter a settlement from a class action lawsuit

Stufflikethat — Fri, 26 Jul 2019 06:34:24 GMT

I had problems with turbo tax misdirecting my payment i paid over $100 and it was to be free. I told family members and called turbo tax and they blamed it on me. I do i entet tbe class action lawsuit?

Re: How do I enter a settlement from a class action lawsuit

Madesi101 — Fri, 29 Nov 2019 00:04:57 GMT

How do I meet the settlement.

Re: How do I enter a settlement from a class action lawsuit

xmasbaby0 — Fri, 29 Nov 2019 05:50:47 GMT

@Madesi101

"How do I meet the settlement?"

What settlement are you referring to? You have posted to a thread full of other people's old questions and replies. Did you receive a settlement of some kind?

Re: I did not get any 1099-MISC

kelly1951 — Sat, 25 Feb 2023 17:36:35 GMT

what section does the golden state stimulus II go in? Also, where does a class action suit payment go in turbo tax California resident

Re: I did not get any 1099-MISC

VolvoGirl — Sat, 25 Feb 2023 17:40:07 GMT

Do you mean the CA Middle Class Tax Refund on a 1099MISC? The IRS has ruled the California Middle Class Tax Refund is NOT taxable. So you don't have to enter it at all
https://www.irs.gov/newsroom/irs-issues-guidance-on-state-tax-payments-to-help-taxpayers

Re: No 1099-MISC received. Did the steps above but keeps aski...

pmersereau — Tue, 07 Mar 2023 20:04:07 GMT

I have the same problem! What to do about it?

Re: No 1099-MISC received. Did the steps above but keeps aski...

GeorgeM777 — Tue, 07 Mar 2023 20:22:01 GMT

We need you to clarify and provide some additional tax information about your tax situation. The previous poster you reference seemed to have an issue with entering an EIN. Is finding/entering the EIN your tax issue? Also, what type of income are you trying to report? Many on this post seemed to have legal settlements to report. If you can provide additional information, we can better understand your tax situation.

@pmersereau

Re: No 1099-MISC received. Did the steps above but keeps aski...

pmersereau — Tue, 07 Mar 2023 20:36:14 GMT

Yes, It's about a legal settlement check which appeared with no 1099-MISC and hence no EIN.

Re: No 1099-MISC received. Did the steps above but keeps aski...

MayaD — Tue, 07 Mar 2023 21:05:46 GMT

What type of settlement did you receive?

Physical injury or sickness settlements (dog bites, mesothelioma, etc.) are nontaxable and don't need to be reported unless you deducted medical expenses related to the injury on a previous tax return and you received a tax benefit from the deduction. In that case, report the medical expenses related to the incident as miscellaneous (other) income.

For more information please check:

Are legal settlements taxable?

Settlements—Taxability

To report taxable legal settlements not reported on a 1099-MISC:

Sign in to TurboTax and open or continue your return
Search for lawsuit settlement and select the Jump to link
Answer Yes to the question Any Other Taxable Income?
1. If you've already entered miscellaneous income, select Add Another Miscellaneous Income Item
Enter a brief description and the amount you received and select Continue

Re: No 1099-MISC received. Did the steps above but keeps aski...

JG1902 — Fri, 17 Mar 2023 02:49:25 GMT

I'm having the same issue: in 2022 I received a check for a settlement reward with no EIN.

-The case is Facebook Biometric Information Privacy Litigation. (Facebook allegedly violated the privacy of users in my state by misusing biometric information but FB is not admitting fault, just settling the case.)

-No physical injury or physical sickness is involved, no lost wages or profits, and no loss-in-value of property.

Turbotax is not allowing me to file electronically without the EIN; it gives me a message saying I will have to file by mail. Is there any way around this?