We received $36k for a class action settlement in 2018. We have been padding our checking account in anticipation of needing to pay income taxes on that. However, we haven't received a 1099. (Would it even be a 1099?) We've contacted the person with whom we communicated prior to receiving the settlement (over a year ago, but also contacted a general number for the firm) and have not gotten a response to any of our attempts.
We've also moved (in mid-January), and although we do have our mail forwarded, I suppose it's possible something is lost in the shuffle.
The settlement is from an investment property. In short, apparently the sellers were telling buyers that their deposits were non-refundable, when that was not allowable by state law. It made no difference to use as we never considered backing out, but we certainly didn't complain about the nice little check!
My research tells me that settlements where there was physical harm are not taxable. However, "When a lawsuit is related to anything that did not cause physical harm-discrimination of any kind, loss of income, or devaluation of an investment-the lawsuit settlement proceeds are taxable."
That suggests to me this would be taxable, but I suppose it might be considered something that devalued the property, maybe?
I know no one can give legal advice on an internet post and I will certainly not consider anything anyone says to be legal or expert advice. IOW, you are legally off the hook for whatever you tell me. So, any thoughts on whether we need to try harder somehow to get tax info? Or should we report it on our own, without the 1099? Or if we can feel confident this isn't taxable? Or...??
