Open TurboTax

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
Announcements
Your taxes, your way. Get expert help or do it yourself. >> Get started
Close icon
Do you have a TurboTax Online account?

We'll help you get started or pick up where you left off.

cancel
Showing results for 
Search instead for 
Did you mean: 
jfuerte
New Member

TT asking for Schedule C when inputting 1099 MISC for lawsuit settlement for my wife

My wife got a class actions lawsuit settlement from her job for $150.  Because of this she was sent a 1099 MISC for the income.  When I get towards the end and review everything it's asking me to select a schedule C to add this to, but unless I'm totally wrong this shouldnt be considered self employment income right?  What am I doing wrong?

 

Here's a couple other tid bits that could help:

1.  I do have a 1099 NEC that I have input for myself since I did contracted work in 2020

2.  The income of $150 shows up in box 3 of the 1099 MISC along with the W2 portion on the bottom half which I've already input as well.  Box 10 also has $139.80 for gross proceeds to attorney

3.  I input the 1099 for my wife under the Other Common Income section

4.  TT is saying that box 10 for the attorney fees is what needs to be linked to a schedule C

 

Thanks for any help!

1 Reply
AmyC
Employee Tax Expert

TT asking for Schedule C when inputting 1099 MISC for lawsuit settlement for my wife

Attorneys are paid and receive the wages, the program thinks you wife is a lawyer that earned $139.80 now. Empty that box. You only need to report what she actually received, in box 3. You may want to contact the issuer and ask for a corrected form. I feel like if the IRS did care enough to ask, they would accept your simple explanation and not have a problem.

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

About Community

Learn about taxes, budgeting, saving, borrowing, reducing debt, investing, and planning for retirement.

3.48m
Members

2.6m
Discussions

Manage cookies
v