Q: When deducting attorneys fees incurred for the collection of taxable alimony, do I deduct the full amount incurred?
On my tax returns, When deducting attorneys fees incurred for the collection of taxable alimony, do I deduct the full amount incurred or only the portion that I paid? I still owe on the total I incurred.
For example- I incurred $15,000 in attorneys fees to enforce collection of taxable alimony, but have paid $10,000 of that amount thus far. Which amount do I put as the deduction?
A: You can deduct only the amount you actually paid.
Without doing any research, my best guess would be “none of the fee may be deducted”. The reason is that this may be considered “personal” and you may have been able to deduct it subject to 2% limitation before 1-1-2018, which was repealed by the 2017 tax law. Of course, your paid lawyer may research the law and find an exception for you. I hope this will not offend you. Zaher Fallahi, Esq, CPA (CA &D.C.).
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