Legal Fees

[Cheryl Rein]

My client has financial pwr of atty over aunt in nursing home. Out of the goodness of her heart, pd 2087.50 in legal fees out of her own pocket for the Aunt to get the house in CT sold. Aunt is on medicaid & has no money. Can she deduct them anywhere? She is not paying for any living expenses - long term care policy pays $100 per day, government pays the rest after taking the house, so she's definitely not a dependent.

How about Misc deductions on Schedule A? Or maybe Medical deductions? I hate to see her lose these deductions.

Thanks,
cherylrein@aol.com

[Gretel]

I would hate that too and try to find something. But I don't see how.

Would have been good to make arrangements with title company to get money back from proceeds.

[theresa d]

it's a shame

i agree. i don't think there is any way she can deduct. can only deduct legal fees if incurred in the course of generating taxable income. this was a gift. hopefully she'll be rewareded for her good deed with blessings, but no tax deduction.