I received a W2 and 1099MISC for settlement of underpaid back wages. Entering both appears to double tax. Is it correct to enter both the W-2 and the 1099-MISC?

[PaulaM · Accepted solution]

Yes, enter both forms as they are reported. The W-2 represents payment for back wages. The 1099-MISC probably contains taxable income from proceeds that were punitive in some form.

When entering the 1099-MISC, indicate that the form was received from a lawsuit and the amount (if any) that represent back wages.

See attachment.

[ytpete]

At least in my situation - the high-tech employer antitrust litigation settlement - the amount that represents back wages was 100% on the W-2, and the 1099-MISC contained _only_ money that does not count as back wages (specifically, it contained "statutory multiplier damages." So the two forms don't overlap or double-count anything.

[patrissimo]

Same here. Although my TurboTax (Mac, 2015) crashes whenever I select "This was money from a lawsuit settlement", so I'm trying to figure it out myself on the worksheet.

The options for where to report it are "Schedule C", "Schedule F", or "Form 4835". Those last two are for farm income. Schedule C is self-employment. This amount is supposed to just go to 1040, line 21 (other income). I ended up just answer "none of these apply".

[mobilerun]

So you ended up not reporting your 1099misc?  I'm confused on this as well.

[alyxsullivan1998]

The check is for $34.56 I worked there for 2 weeks and received one check I worked here this was a few years ago

[alyxsullivan1998]

Ut will not let me as well as not being able to change my direct deposit acct number