Client is paying lawyer to sue BofA to get their mortgage modified. They both work from their home, he with a Sch C, and she at an employer required home office.
Any thoughts on deductibility?
Any thoughts on deductibility?
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Yes
To the extent they are deducting mortage interest on their office-in-home, I would see that percentage of the lawyer fees as deductible as well.Originally posted by joanmcq View Post
If the rest of it would be deductible on Sch A, I'm not sure -- it's not really an expense to protect income (which would bedeductible), but it's an expense to reduce their deductions, which in turn increases taxable income.
Bill -
TTB page 4-26:
I don't think the portion not related to the office in home business is deductible because it is not related to producing or collecting taxable income.Legal fees related to producing or collecting taxable income or
getting tax advice is deductible.Comment
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What about retention of income? Wouldn't that qualify for the total amount of the portion of the atty fees related to such?Believe nothing you have not personally researched and verified.Comment
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