Hello and thank you for using Just Answer.The amount of the award would be added to your income on Line 21 of the 1040. The expenses for attorney would then be shown on your Schedule A under Misc Deductions. These are set by the 2% limitations, this means that the amount that is over 2% of your Adjusted Gross Income will be calculated and used on the Schedule A.
You may claim legal fees that are paid in relation to taxable income only. If no taxable income is involved then the fees would be considered personal and not deductible.
Robin I did not receive an award I paid it, 5000.00.
Was it in relation to business?
If not you may not claim the amount at all. It would be concidered personal.
Yes conducted over a dispute I had over an automobile lease, which I decided to settle out of court.
Was the car lease for your business or a personal vehicle for your self?
I could of used it for either or probably business because of its excellant mileage.
No, you hacd to have a clear course of action on the lease before this happened. Did your business lease this vehicle?
I leased it for myself to lessen the burden of driving between businesses in my sales position, which requires alot of hours behind the wheel.
Well, I am still going to stay with the info I stated befire. If you paid legal fees that were inrelation to your taxable income then you can claim them on the Schedule A. The amount you paid to settle you personally cannot take as a deduction. You would only be allowed any legal fees that you were charged to handle the disagreement and then only if it was directly involved with taxable income.I would advise no, unless you are self employed.
I know this is not what you wanted to hear but I thank you in advance for clicking ACCEPT.