My wife received a 1099-MISC for a class action lawsuit w/ a previous employer for improper wages. How should I enter this as the Box labels don't match on TurboTax?

[LinaJ2018 · Accepted solution]

You would enter under the 1099-MISC section.  Here are the steps (online):

1. Sign in to your account, select Pick up where you left off
2. At the right upper corner, in the search box, type in 1099misc and Enter 
3. Select Jump to 1099-misc
4. Enter information on the 1099-misc screen
5. Next screen, Describe the reason for this 1099-MISC, enter Lawsuit settlement
6. Next screen, Does one of these uncommon situations apply?  Check This was money from a lawsuit settlement, answer questions related to the back wages

When you check your return, this amount will be reported as wages on line 1 on the Form1040 and an offset amount shown on line 22 from 1099-misc on Schedule 1. 

[Edited 4/5/2020 | 6:25 PM]

[ajkalin]

That is what I wondered but it specifically says on that page "Do not enter income reported on Form 1099-MISC". What confuses me is the 1099-MISC we received is structured very similar to a W-2 with "Wages", "Federal Income Tax Withheld", "Social Security Wages", etc so I don't want to be taxed twice if federal tax was already withheld.

[LinaJ2018]

May I know how your 1099 misc is being reported?  Is there an amount in box 3 and box 4 ? As far as  Social Security wages, that is strange.  Can you take a snapshot and send to me here?

[ajkalin]

I'm not sure how to upload a snapshot thru here but looking closer at the form there are 3 squares on the sheet. The top (largest square) is labeled 1099-MISC and only has an amount in box 3 (Other income). There are two smaller squares at the bottom of the sheet that are labeled W2 in small print in the bottom corner. (I originally just assumed they were all 1099-MISC since that is what the large letters at the top of the page said). The W-2s are the ones that have numbers in all the boxes. So I guess now my question is, do I enter this income in as a W-2 or 1099-MISC? Sorry for the confusion!

[LinaJ2018]

No worries.  You would enter under 1099 misc.  Please see my edited answer from above.  

[ajkalin]

Thank you for your help!

[LinaJ2018]

You are welcome!