Attorneys fees formerly unreimbursed employee expense

USA Discussion in 'Individuals' started by McMike, Dec 18, 2018.

  1. McMike

    McMike

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    A previous employer exposed me to IRS trust fund recovery proceeding for unpaid payroll taxes. I eventually prevailed and was found not responsible by the IRS. It cost me a bundle of attorney fees. Are there any avenues for tax treatment?

    The employer promised to cover my legal expenses. and did so while I was still employed. Then I left employment, and the company was also insolvent wihich led to bankruptcy filing. So they never reimbursed me.

    So, it is both un-reimbursed employment expense and/or bad debt.

    I think I'm wishing this was in 2017. Actually, the process started in 2017, but the legal fees were paid by me in 2018 as the case proceeded.
     
    McMike, Dec 18, 2018
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  2. McMike

    kirby VIP Member

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    Read IRS publication 529 - Miscellaneous Deductions. Legal fees related to doing or keeping your job are deductible as are unreimbursed employee expenses. The bad part is these deductions are usually subject to a limitation.
     
    kirby, Dec 18, 2018
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  3. McMike

    McMike

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    Thanks, I got the impression that this deduction got whacked in the 2018 tax law.
     
    McMike, Dec 18, 2018
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  4. McMike

    kirby VIP Member

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    Wow, unfortunately you are correct.
     
    kirby, Dec 18, 2018
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