There are provision for worthless stock that could possibly allow you to report the loss before the process is completed.  If you are interested in claiming the loss you should look at that.  I believe the instructions also walk you through what to do in future years when new information is known or money is received. To answer your question: I would put the 1099 Misc in and carry it to misc. income as it states. Then I would go to line 8 Other Income and enter a negative amount and as description put removing 1099 MISC income to report on Schedule D. Then I would go to schedule D and put it in again showing that this is a capital transaction and that you are using up your basis to offset this income which reports no gain or loss at this time.  Note the new basis for when this settles and final loss is claimed. Ask questions as maybe this is something that you are supposed to be reporting a prorated share of the gain or loss at this time, rather than making this transaction go to zero.  If the taxpayer received money, they probably received a letter from the bankruptcy attorney explaining what was going on and maybe even telling them how to report this.    

I think you are right at $240. Unless there was additional excess contributions in 2019. Start with the penalty amount of $480 and try to follow it backwards.  It sounds like somewhere there is an addtional $4,000 entered in the wrong place. Also review the IRA contribution worksheet.  Sometimes I can find links there or entries there that by following will take me to the source. Another place to look is the carryforward information. This is a tough one if it is really resulting from computer carryforward as it may not be somewhere in the system that we are familiar with entering.