Received a 1099-MISC incurred through a labor settlement that has two boxes filled out: Box 10 (Gross Proceeds Paid to an Attorney) and Box 16 (State/Payer’s State No.) which is xxx-xxxxx. There’s nothing else printed on the form. When I enter this into TT, it asks me which Schedule C to attach it to (which makes no sense as it wasn’t income from self-employment). I just skipped that and tried to file, but it won’t let me due to the above issue. TT also has an issue with the format of Box 16. What can I do about this? Please help.
Please delete the entry that is asking for a schedule C
Then follow these steps to enter the 1099-MISC
Federal
Wages and Income
Other Common Income
Form 1099-MISC
Then click my form has other info in Boxes 1-17
That will give Box 10 and Box 16
Give reason for 1099-MISC as lawsuit settlement
Then select This was money from a Labor settlement on next screen
Answer questions about back wages and continue with return
Thank you for the taking the time to try and solve this mystery. Unfortunately, after doing exactly as you stated, after I had pressed “Continue,” a popup appeared stating, “Enter the portion of the payment you received that is considered your fees on the appropriate line. This amount will transfer to the schedule C self-employed business that you designate.” I chose to ignore it and proceed. However, just as before, at the very end — right as I’m about to EFile, TT alerts me to review the info. When I do so, the 1099-MISC appears and “Required” is next to Box 10 and the words, “You must designate which Schedule C to apply this to.” It’s an endless loop in which no solution seems inevitable.
I suggest you contact the issuer and tell them you are not an attorney and they need to issue a corrected form. I would think box 3 other income, as it is the most common.
I do not understand why you have a form showing you received attorney fees if you are not the attorney. Many lawsuits are not taxable. Do you even have taxable income?