How much tax on settlement?

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» How much tax on settlement?

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Feb 8, 2008, 02:34 PM

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mystique3790 is offline

Join Date: Feb 2008

Posts: 1

How much tax on settlement?

Last year my mother recieved a settlement after suing her employer of $11 thousand dollars. How much tax will she end up paying the IRS for this? We recieved a 1099 for it and live in AL. Thanks

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Feb 13, 2008, 12:35 PM	#2

AtlantaTaxExpert Tax Expert Join Date: Feb 2005 Location: Atlanta, Georgia Posts: 10,013	Since it probably replaced lost wages, the setttlement is considered taxable. Enter it on Line #21 of Form 1040 as "Other income".

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