Are Any Legal Fees in Divorce Tax Deductible?

Typically, the IRS is not accommodating to individuals that are going through a divorce and looking for deductibles. Yet there are times when you may be able to salvage a deduction for the portion of expenses that are specifically allocable to tax advice in connection with a divorce or separation. You may also be able to secure a deduction for the legal fees that are needed to obtain taxable alimony.

The IRS prohibits any deduction for the cost of personal advice, counseling, or legal action in a divorce. This means that you can't write-off the costs of legal counsel or assistance in resisting requests for more alimony, eliminating alimony, or more. These expenses are always considered to be nondeductible, even though they're partly incurred in arriving at a financial settlement.

However, legal fees that are used to collect alimony that is taxable can be included. This can be written on Schedule A of Form 1040 in the "other expenses" line. The collecting spouse who may request an increase in taxable alimony can also deduct legal fees that are incurred when arguing for more payment. The IRS is still picky when it comes to this deductible. A spouse that is requesting alimony is only allowed a deduction that exceeds 2% of her adjusted gross income for the year.

A spouse cannot deduct the cost of obtaining income that isn't taxable. For example, temporary alimony or child support that was paid while a joint return was being filed in not taxable. A wife who does not seek a change in an alimony arrangement also cannot write off the cost of a suit to acquire assets awarded her ex-husband in a divorce action. Taxable deductibles can get complicated. If you are trying to figure out what you can write-off, you will want an attorney to assist you in your case. Don't hesitate to hire a skilled San Fernando divorce lawyer at Cutter & Lax to help you today!