Tax Law (Questions About Taxes)/Fees Paid to Attorney

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Question
Hi.  I live in Pennsylvania.  In 2012, 2013 and 2014, I paid fees to an attorney to litigate a case for me to be paid severance that was denied to me when I was terminated from a job in 2012.  In 2014, the company and I came to a settlement and I was paid severance.  My question for you is this:  Since I didn't get any income from the legal action until 2014, can I still deduct the fees I paid my attorney in 2012 and 2013 in addition to the fees paid in 2014?  Or can I only deduct the fees I paid my attorney in 2014?

Thanks for your help.

Answer
Nick,

Thanks for your question.

Since the attorney's fees are amounts paid to protect income, they are deductible as a miscellaneous itemized deduction subject to the 2% limitation.  However, they are only deductible in the year in which you paid them, so you would need to file an amended return for each past yeR in which you did not deduct them.

Hope this helps.

John Stancil, CPA

Tax Law (Questions About Taxes)

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John Stancil, CPA

Expertise

I can answer questions on personal income taxes, partnerships, and some corporate income taxes. I can deal with some state tax questions. Limited gift and estate tax questions. I am also familiar with ministerial and church tax reporting issues. I am Professor Emeritus at Florida Southern College. Sales taxes and property taxes are state and local issues so I am not likely be be able to give you an in depth answer on those types of taxes. I have maintained a CPA practice, specializing in tax, for over 35 years. I am a member of the National Association of Tax Professionals, The Florida Insititute of CPA's, The NCPE Fellowship. In addition I am a Certified Mentor for SCORE. Visit my website at www.mybaldcpa.com. I also offer seminars and consultations to churches and clergy on their tax issues at www.churchtaxsolutions.com Also visit my blog, www.thetaxdocspot.com. I am listed on Tax Connections at https://www.taxconnections.com/profile/John-Stancil/12258973 Prepare and file your own taxes at www.1040stancilcpa.com

Experience

I hold a doctorate in Accounting, and am a CPA. My certifications of CIA, CFM, and CMA are inactive. I passed all certification examinations on the first attempt, and received honorable mention for my scores on the CIA exam. I have operated a CPA firm for over 37 years and have taught accounting and tax at the college level for over 35 years.

Organizations
FICPA, NATP, NCPE Fellowship, Lakeland Business Leaders

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The CPA Journal, Florida CPA Today, Green Consumer, Green Business, Global Sustainability as a Business Imperative, Palmetto Review, NATP TaxPro Quarterly, Mustang Journal of Finance and Accounting.

Education/Credentials
DBA University of Memphis MBA University of Georgia BS in Accounting Mars Hill University

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