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Poltax75
Level 4
July 25, 2024

Client's LLC received a Mutually Agreed Settelment with income shown on line 3 of a 1099 -MISC

  • July 25, 2024
  • 1 reply
  • 8 views

My Client's LLC  received a mutually agreed court settlement for damages to property, mostly research results and documents, used in his business.

He received  A 1099-MISC with the amount shown in line 3 (Other Income) $70k

He also has legal fees which were not covered by the settlement. This his specifically stated in the settlement

What is the best way to report this on Schedule C.

1 reply

sjrcpa
sjrcpa
Level 15
July 25, 2024

The $70K is reported as part of the income.

The legal fees are deducted on the legal and professional services line.

The more I know the more I don’t know.
    IRonMaN
    IRonMaN
    Level 15
    July 25, 2024

    As they say on Family Feud - good answer.

    Slava Ukraini!
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