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Entering a legal settlement reported on Form 1099-MISC with box 3 “Other Income” checked.

aedwan
Level 4

A client is an Uber driver who received Form 1099-MISC with Box 3 (Other Income) checked from a legal settlement (O'Connor V. Uber.) Once reporting it as other income on the 1099-MISC worksheet, do I link it Schedule C (Subject to SE tax) or check box "Other Income" from rundown list:

  • Tribal Member Gaming Income
  • Winnings (Prizes, etc)
  • Alaska Permanent Fund
  • Other Income
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5 Comments 5
HOPE2
Level 8

If it is related to UBER about missed compensation would it go schedule C.

aedwan
Level 4

Thanks HOPE2! Reporting it on Schedule C makes sense. In the O’Connor’s case, the plaintiffs allege that Uber misclassified its drivers as independent contractors rather than employees…Thus, failing to reimburse drivers for certain expenses such as mileage and other vehicle-related expenses. 

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BobKamman
Level 15

Interesting question. "I got this money only because I claimed I should have been classified as an employee but now you tell me that I'm back to being self-employed."  

aedwan
Level 4

Interesting Indeed! Despite lower court and California Court of Appeals’ rulings that rideshare drivers are employees and not independent contractors, drivers in California are still being treated as independent contractors.

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BobKamman
Level 15

The changes made by the 2020 election ballot issue has a lot to do with that.  But this settlement goes back to the way the company operated in 2019 and earlier years.  Putting it on Schedule C is just an off-the-top-of-the-head suggestion.  

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