I received a 1099 Misc reported as other income due to a lawsuit settlement. Is this taxable and if not, where do I enter a subtraction?

[KittyM]

It depends on what your lawsuit settlement was for, as to if it is taxable, or not. You should consult with your lawyer to determine how much of your award is taxable. This is not a determination I can make, but work discrimination and whistleblower settlements are generally not taxable, nor are personal injury settlements to the extent they are compensatory.  Punitive damages and interest are taxable.

Once you have determined how much is taxable, here is how to remove the non-taxable portion:

• In your Federal return, choose the tab for Wages & Income
• Scroll down to Less Common Income (you may have to click Add more income and See more income to view this topic) and Show more
• Start/Revisit Miscellaneous Income and choose Other reportable income 
• Say Yes to continue to the screen Other Taxable Income. Enter your item description and the amount you are subtracting as a negative number.