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Entered other income (lawsuit settlement) with no 1099-MISC per Turbotax instructions. During review of return it keeps wanting a TIN. There is non. Can I just ignore it?

 
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3 Replies
MayaD
Expert Alumni

Entered other income (lawsuit settlement) with no 1099-MISC per Turbotax instructions. During review of return it keeps wanting a TIN. There is non. Can I just ignore it?

What type of settlement did you receive?

Per IRS:

Awards and settlements can be divided into two distinct groups to determine whether the payments are taxable or non-taxable. The first group includes claims relating to physical injuries, and the second group is for claims relating to non-physical injuries. Within these two groups, the claims usually fall into three categories:

  1. Actual damages resulting from physical or non-physical injury;
     
  2. Emotional distress damages arising from the actual physical or non-physical injury; and
     
  3. Punitive damages

irs.gov

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Entered other income (lawsuit settlement) with no 1099-MISC per Turbotax instructions. During review of return it keeps wanting a TIN. There is non. Can I just ignore it?

All I received is a letter with a check attached from Philips Respronics to settle a recall. Do I even have to report this income?

ThomasM125
Expert Alumni

Entered other income (lawsuit settlement) with no 1099-MISC per Turbotax instructions. During review of return it keeps wanting a TIN. There is non. Can I just ignore it?

You would not have to report the income unless you received an economic gain from it. If the settlement was intended to reimburse you for an expense you incurred previously, then it is not taxable. If it was more than an expense you incurred, then the portion that was more than your expense would be taxable.

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