If you didn’t receive a 1099-MISC, follow these steps to report the income:
- Open (continue) your return in TurboTax.
- Type “lawsuit settlement” in the Search box and then select the “Jump to” link.
- Answer Yes to the question Any Other Taxable Income?
- Enter a brief description and the amount you received and click Continue.
You can usually deduct legal expenses that you incur in attempting to produce or collect taxable income or that you pay in connection with the determination, collection, or refund of any tax. Legal Fees are included on Schedule A as a Miscellaneous Itemized Deduction, subject to a 2% limitation based on your Adjusted Gross Income. (TurboTax will make this determination for you.)
Search on "legal expenses, deduction" and click the "jump to" link to go directly to the start of this topic.
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