Skip to content
English
Contact us
  • There are no suggestions because the search field is empty.

Deductible Attorney Fees

Attorney fees: can you deduct them?

Sometimes attorney fees can be deducted. For business returns, it is possible to deduct attorney fees.

Personal tax returns are a little more complicated. Before the Tax Cut and Jobs Act (TCJA), attorney fees are allowed to be deducted. It was considered a miscellaneous itemized deduction, subject to a 2% limitation. The Tax Cut and Jobs Act suspended this deduction through 2026.

Attorney fees are added to income on Schedule 1.

The award for a claim goes in Box 1.

The attorney fees are deducted in Box 10.

Fees are deductible as long as they happen in the same year. They cannot exceed the amount of recovery.

Attorney fees are only deductible if they: 

  • are paid within the same year as the claim.
  • do not exceed the amount of recovery.

Here are some examples of personal legal fees that are deductible.

  • Discrimination claims, including employment and civil rights.
  • Some types of whistleblower claims, including with the IRS and SEC.

Here are some examples of personal legal fees that are not deductible.

  • Child custody
  • Promise to marry lawsuit
  • Civil or criminal charges regarding a personal relationship
  • Preparation of a title or will
  • Property claims
  • Legal fees on producing or collecting taxable income
  • Damages for personal injury

To enter attorney fees in our software from Form 1040, select the deductions, adjustments, certain attorney fees, and other adjustments option.

Reminder: Always report all court rewards as a gross value.