Frequently Asked Tax Questions And Answers
Keyword: Legal Fees
3.4 Itemized Deductions/Standard Deductions: Interest, Investment, Money Transactions (Alimony, Bad Debts, Applicable Federal Interest Rate, Gambling, Legal Fees, Loans,
etc.)
Are the legal fees incurred or paid for collection of Social Security
Benefits deductible?
Personal legal fees are not, generally, deductible. However you may deduct
legal fees incurred or paid for the production or collection of taxable income.
The portion of the legal fees that is deductible would be proportional to
the taxable part of your Social Security benefit collected. The deduction
is taken on line 22 of Form 1040 Schedule A (PDF), Itemized
Deductions , subject to the 2% of Adjusted Gross Income Limitation. For
more information, refer to Publication 529, Miscellaneous Deductions;
and Publication 915, Social Security and Equivalent Railroad Retirement
Benefits.
References:
Publication 529, Miscellaneous Deductions
Publication 915, Social Security and Equivalent Railroad
Retirement Benefits
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