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Tax Deduction Consulting: Legal Expenses Goffstown NH

To understand this distinction, the legal fees involved in the dissolution of a marriage provide a good example. The legal fees paid to a lawyer to handle divorce proceedings would be considered purely personal legal fees and would not be tax deductible.

Mr. James E. Knee (RFC®), MBA
(603) 224-1010
6 Loudon Road, Suite 505
Concord, NH
Company
Sterling Financial Services, LLC
Qualifications
Education: B.S., University of Bridgeport;MBA, Southern New Hampshire University;Advanced Certificate in International Business;Series 24 Registered Principal License;Series 7 and 63 Securities License;NH Health and Life Insurance License
Years of Experience: 26
Membership
IARFC, FPA
Services
Invoice, Estate Planning, Pension Planning, Retirement Planning, Tax Planning, Tax Returns, Seminars Work, Employee Benefits, Education Plan, Asset Protection

Data Provided by:
H&R Block
(603) 647-6974
1328 Hooksett Rd
Hooksett, NH

Data Provided by:
Danis & Company
(603) 656-9041
169 South River RD #14
Bedford, NH
 
J Walker & Co LLC
(603) 224-4829
104 N State St
Concord, NH
Hours
Mon 09:00 AM-05:00 PM;Tue 09:00 AM-05:00 PM;Wed 09:00 AM-05:00 PM;Thu 09:00 AM-05:00 PM;Fri 09:00 AM

Data Provided by:
Mr. James E. Knee (RFC®), MBA
(603) 224-1010
6 Loudon Road, Suite 505
Concord, NH
Company
Sterling Financial Services, LLC
Qualifications
Education: B.S., University of Bridgeport;MBA, Southern New Hampshire University;Advanced Certificate in International Business;Series 24 Registered Principal License;Series 7 and 63 Securities License;NH Health and Life Insurance License
Years of Experience: 26
Membership
IARFC, FPA
Services
Invoice, Estate Planning, Pension Planning, Retirement Planning, Tax Planning, Tax Returns, Seminars Work, Employee Benefits, Education Plan, Asset Protection

Data Provided by:
Fishers Income Tax Svc
(603) 622-2057
616 Mast Rd
Manchester, NH

Data Provided by:
H&R Block Inside Northside Plaza
(603) 628-1976
67 HAMEL DR UNIT B4A
MANCHESTER, NH

Data Provided by:
Devereaux & Ean-Dixon Bookkeeping LLC
(603) 717-1214
PO Box 2794
Concord, NH
Prices and/or Promotions
10% off of individual tax return prep

Steele Associates
(603) 673-4660
54 Nashua St
Milford, NH

Data Provided by:
Seacoast Accountability
(603) 834-1271
2 Washington Street, Suites #301-302
Dover, NH
 
Data Provided by:

Tax Deduction Consulting: Legal Expenses

Legal Expense Tax Deduction

Legal fees are limited as tax deductions. A legal expense tax deduction is only granted to fees for disputes arising form business or income producing affairs. Personal legal fees are not deductible.

When a legal dispute occurs as a result of business activity or as a result of some matter that is related to the producing of income, the legal fees may be taken as a legal expense tax deduction. This is itemized as a miscellaneous tax deduction and is subject to the 2% Adjusted Gross Income floor. Personal legal fees are not tax deductible.

To understand this distinction, the legal fees involved in the dissolution of a marriage provide a good example. The legal fees paid to a lawyer to handle divorce proceedings would be considered purely personal legal fees and would not be tax deductible. However, if the divorce involved the collection of alimony and the alimony was going to be considered as taxable income, the portion of the legal fees paid for this purpose would be deductible. It would be necessary for the lawyer to make a statement detailing what portion of his fee was attributable to the alimony collection.

Another example would involve personal injury suits. If the reward for the personal injury suit was considered taxable income, the legal fees would be deductible. Some personal injury suits do not involve taxable income and, in this case, the legal fees would not be taxable. This would be the same with legal fees regarding a Will dispute. Since any inheritance would not be income that would be reported and taxed on your income tax return, the legal fees would not be deductible.

The principle involved here is actually that the legal fees are considered much the same as a business expense. In a business model, you are only taxed on the profit that you make. If you buy a product for $10, sell it for $15, and pay your salesman $2, you have made a profit of $3. It is the $3 that is subject to tax, not the entire $15 you re...

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