If it is not income, it doesn't belong on a tax return, and playing the game of "try to trick the IRS computer" is more likely to lead to an audit.  There is no indication that IRS is matching these forms to 1040's. The purpose of reporting is to track the profits of those who buy and sell contracts.  If it's a viatical settlement, it's excluded from income just as life insurance proceeds paid to a beneficiary of a decedent are excluded.  We don't add those in and back them out. 

If anything, attach a statement to the return noting the amount received and citing authority for its exclusion.