My client received a 1099-misc form for "lemon law" settlement and also the attorney fees are part of box 3. how do I deduct the attorney fees?

Forum|Forum|4 years ago
June 15, 2022
4 replies
33 views

Form 1099-Misc, box 3 $73,75.96
Actual money received in a check $50,625.50
Attorney fees $23130.50

ProSeries Professional

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Just-Lisa-Now-

Intuit Community Champion

Hopefully they didn't spend it all and can pay the taxes on that 73k.

TCJA took away the ability to deduct most personal legal fees.

https://turbotax.intuit.com/tax-tips/tax-deductions-and-credits/can-i-deduct-legal-fees-on-my-taxes/L98fUeOrM

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪

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natalia920mr24

Level 2

I understood that the only amount could be waived or deducted is, the repurchase amount for the car, then everything else Tax payer needs to pay tax (I wish at least the attorney fees be deducted to because tax payer never received that money and I guess attorneys are paying tax for that income??) where we can deduct in Proseries the repurchase amount ? because in the 1099-misc box 3 is showing the full amount combine "Repurchase amount + additional damage to TP + attorneys fees & costs and awards + any additional damages or awards"

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Terry53029

Intuit Community Champion

Don't forget only the amount over the price of the car is taxable, and as Lisa said the attorney fees are not deductible