Reporting of legal settlement

November 9, 2020

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Q. We have a settlement payment where the agreement states that the whole payment should be made to the plaintiffs and that the plaintiffs are responsible for any attorney fees. However the law firm wants the check made out to both the plaintiffs' names and theirs, and they will only provide their W-9. First question: In this scenario is it okay to report a 1099 to the law firm only in withholding box 14 or is it okay to report a 1099 to the law firm only in withholding box 03? Second question:…

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