TurboTax HelpTurboTax HelpIntuit

Where do I enter an award from a taxable legal settlement?

SOLVEDby TurboTax716Updated January 11, 2022

Legal settlements that are taxable (including previously-deducted medical expenses related to physical injury or illness) are entered as miscellaneous (other) income.

Interest earned on settlements is taxable income and should be entered as a Form 1099-INT.

If you received a 1099-MISC:

  1. Sign in to TurboTax and open or continue your return.
  2. Search for 1099-misc and select the Jump to link.
  3. If you're asked Did you get a 1099-MISC?, answer Yes.
    1. If you've already entered a 1099-MISC, select Add Another 1099-MISC.
  4. Input the information from your 1099-MISC and select Continue.
  5. On the Describe the reason for this 1099-MISC screen,
    type in lawsuit settlement and select Continue.
  6. On the Does one of these uncommon situations apply? screen, select This was money from a lawsuit settlement and then answer the back wages question before selecting Continue.

If you didn’t receive a 1099-MISC, follow these steps to report the income:

  1. Sign in to TurboTax and open or continue your return.
  2. Search for lawsuit settlement and select the Jump to link.
  3. Answer Yes to the question Any Other Taxable Income?
    1. If you've already entered miscellaneous income, select Add Another Miscellaneous Income Item.
  4. Enter a brief description and the amount you received and click Continue.

Was this helpful?

You must sign in to vote, reply, or post
TurboTax Desktop BasicTurboTax Desktop BusinessTurboTax Desktop DeluxeTurboTax Desktop Home and BusinessTurboTax Desktop PremierTurboTax Live BasicTurboTax Live DeluxeTurboTax Live Full Service BasicTurboTax Live Full Service Complex IncomeTurboTax Live Full Service Complex Self-EmployedTurboTax Live Full Service DeluxeTurboTax Live Full Service PremierTurboTax Live Full Service Self-employedTurboTax Live PremierTurboTax Live Self-employedTurboTax Mobile Apps DeluxeTurboTax Mobile Apps FreeTurboTax Mobile Apps PremierTurboTax Mobile Apps Self-employedTurboTax Online DeluxeTurboTax Online FreeTurboTax Online PremierTurboTax Online Self-employed
Dynamic AdsDynamic Ads