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Received w2 as a part of lawsuit settlement and same amount as 1099-misc for penalties and liquidated damages ..
This was lawsuit settlement..employment was back in 2014 and lawsuit was settled in 2017 so received w2 and same amount as 1099-misc (non employee compensation checked) ...
1099-misc was not only for penalties but was also for liquidated damages...which means it included attorney fees...so I understand penalties are taxable income but what about liquidated damages? if it should not consider taxable than how do I adjust that amount in freedom edition?
so now when I am using freedom edition...it shows she needs to refund some of tax credit she received under obamacare... because of this income in 2017.
not only that...employer did not withdraw any federal income tax (employer did withdraw $240 for state income tax) so now the total amount is more than 1300$ ..
Is there any way to avoid reporting this income in 2017 ...and report it in 2014 when real employment was there?
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Received w2 as a part of lawsuit settlement and same amount as 1099-misc for penalties and liquidated damages ..
If you received the settlement funds in 2017, you have to report this income in 2017.
Individuals are "cash-basis" taxpayers - they are taxed on income in the year they actually receive the cash (minor exception for checks received in the first few days of a new year).
If the W-2 and Form 1099-MISC are reporting the same income (in whole or in part), you will want to make an adjustment to avoid double-taxation. If that is the case, please update this post with a comment and provide specific details (no personal information, please - just box and income information).
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Received w2 as a part of lawsuit settlement and same amount as 1099-misc for penalties and liquidated damages ..
I understand that ...income to be reported and tax paid in 2017 but I am wondering if there is any way / loophole to avoid or reduce tax liability ...like I said this was unexpected so there is penalty for paying enough for health insurance.(because this income was not considered when applied for govt. health insurance)
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