Something new today...

[DTS]

I ran across a 1099-SSA that had an amount of $3,400 for "attorney fees" listed as part of the benefits.

I've never seen this before. I thought it might be for some type of settlement trying to get these benefits. Could this be correct?

Anyone ever seen this before? If so, what is this?

Dennis

[Brian EA]

I ran across a 1099-SSA that had an amount of $3,400 for "attorney fees" listed as part of the benefits.

I've never seen this before. I thought it might be for some type of settlement trying to get these benefits. Could this be correct?

Anyone ever seen this before? If so, what is this?

Dennis

Yeah! Yeah! YEah! One of those .The client had to get help from the attorney before the SSA could give him his benefits. That is what the attorney was paid.

[Unregistered]

you can put those fees on Schedule A - subject to 2% rule (assuming that the social benefits become taxable)

[S T]

Deduction for attorney fees

Dennis,
See the following:

Attorney Fee Deduction. If a taxpayer discovers that some of the Social Security lump sum - when added to regular benefits received in the same year - turns out to be taxable, the attorney fee may be deducted from income, but only to the same extent that Social Security is taxed. For example, if a taxpayer paid tax on 50% of SSA benefits received, the taxpayer may deduct half of the attorney fee paid or incurred during the same year. [IRS Revenue Ruling 87-102] The taxpayer faces the burden of filing an itemized return, of course, and this limited deduction is further subject to the “2% of adjusted gross” ceiling on miscellaneous itemized deductions.

Sandy

[DTS]

Thank you

I appreciate the answers. The benefits are 85% taxable, but with the income level, I doubt they will be able to use on the A, but I'll give it a shot!

My Grandmother had a similar situation in 1965, so I thought this might be the case here.

Dennis