USTaxAid Services

You can rack up legal fees for personal issues or for business issues. The personal attorney fees might be deductible under “miscellaneous deductions” on Schedule A-Itemized Deductions. Check with your CPA on that one. It will depend on what the legal fees were actually for.

Legal fees for your business are deductible. One additional point to note, though. The IRS requires that you send a Form 1099-MISC to report legal fees paid for all businesses. Generally there is an exception to reporting on a Form 1099-MISC for corporations. In the case of attorneys, ALL payments need to be reported, regardless of what type of business structure they have.

The Form 1099-MISCs need to be prepared by end of January of the following year.

Don’t Miss Our Tips Archive! Click Here