Thank you !-  The client is not sure what form she will be receiving, but agreed it most likely be a W-2.  They are taking the legal fees from the settlement.   So, if it is a W-2, she will get a W-2 do 60K, but only a check for 40K.    If the client's settlement qualifies for the unlawful discrimination definition, would they still be able to take the above the line deduction?