I received a 1099-misc for a lawsuit settlement and now it says I'm self employed, which I'm not. I clicked the box for settlement but I owe $. Anything else I should do?

[Carl]

What box on the 1099-MISC is the income reported in? What was the payment for? Back pay? Pain and suffering? something else? It matters what it was for, because not all settlements are tax deductible. It also matters so that you report it in the correct place on your tax return.

[AlienBaby]

It was for unpaid overtime (gutierrez v. google). I searched the case and the words "back pay" never came up. I don't know if these things are the same.

[Carl]

It's back pay and is fully taxable income to you. When you enter the description of it, make it something like "Overtime Back Pay". The employer should have issued you a W-2 for that. But that's not your problem. They'll be the ones fined for incorrect reporting, not you.

Reporting 1099-MISC (box 3 or box 7) that is not self-employment income

Under the Wages & Income tab (or Personal Income tab) scroll down to Other Common Income and elect to start/update Income from form 1099-MISC. Then click YES to indicate you have a 1099-MISC.

Enter the 1099-MISC exactly as printed, and then Continue.

Enter the reason you got this money – be it scholarship, bonus, streaking butt naked across the 50 yard line of the super bowl, whatever. Then continue.

Select None of these apply, then Continue.

Select No, it didn’t involve work….. and Continue.

Select ONLY the tax year for which this specific 1099-MISC was issued. Do not select the year that you received the 1099. Select the year for which the 1099-MISC was issued. Select no other year. Then Continue.

Select No, it didn’t involve an intent to earn money, then Continue.

Select NO, then Continue.

Click the DONE button, and that does it.