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Level 2
December 25, 2024

Tax Penalty Deduction

  • December 25, 2024
  • 1 reply
  • 10 views

My client incurred and paid a tax penalty due to an error I made on his tax return.   I am reimbursing my client for penalty he paid and am questioning whether I can deduct client reimbursement on my Schedule C as a reimbursement expense.   

    1 reply

    BobKamman
    Level 15
    December 25, 2024

    Yes it is deductible.  I would put it under "returns and allowances."