ILLMAS Posted June 17, 2022 Report Share Posted June 17, 2022 Scenario: TP was let go in 2016 and sued their former employer for discrimination and won, former employer paid the following in 2018: Back wages $70,000 on a W2 Non-wages $69,000 on a 1099 Legal Fee $70,000 paid to attorney + $20,000 paid out of pocket = $90,000 Legal Expenses (Pub 529) Legal expenses that you incur in attempting to produce or collect taxable income or that you pay in connection with the determination, collection, or refund of any tax are miscellaneous itemized deductions and are no longer deductible. You can deduct legal expenses that are related to doing or keeping your job, such as those you paid to defend yourself against criminal charges arising out of your trade or business Can the legal fees paid in 2018 be deductible based on the scenario and what is on publication 529? Thanks Quote Link to comment Share on other sites More sharing options...
DANRVAN Posted June 18, 2022 Report Share Posted June 18, 2022 Looks to me like they should be deductible, but aren't you past the three year window to amend a 2018 return? 1 Quote Link to comment Share on other sites More sharing options...
Lee B Posted June 18, 2022 Report Share Posted June 18, 2022 If this meets the definition of an unlawful discrimination claim, then the taxpayer may be able to to take an adjustment to income. 2 hours ago, DANRVAN said: Looks to me like they should be deductible, but aren't you past the three year window to amend a 2018 return? Was a return never filed for 2018? Quote Link to comment Share on other sites More sharing options...
ILLMAS Posted June 19, 2022 Author Report Share Posted June 19, 2022 No sadly Quote Link to comment Share on other sites More sharing options...
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