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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 10142
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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I am currently on an instalment basis with the IRS paying

Customer Question

I am currently on an instalment basis with the IRS paying them for taxes I owed in two years ago, can I claim this payment as a deduction on next year's tax return?
Submitted: 1 year ago.
Category: Tax
Expert:  Lane replied 1 year ago.

Hi,

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So sorry no

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Payment of late taxes, penalties, or interest, against other years' taxes is never a deduction in some other year.

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Under the doctrine of no double taxation, you can deduct state taxes, property taxes, and taxes paid to another jurisdiction (foreign country).

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This is the same doctrine that state taxing authorities provide if you pay taxes for working in a non-resident state.

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ALL to prevent paying taxes twice on the same income dollar.

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But again, so sorry, there is no deduction for taxes that have not YET been paid to a given taxing authority and federal tax law (Title 26, US Code) makes penalties and interest on unpaid taxes non-deductible as well.

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Let me know if you have questions,

Lane

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I hope you'll rate me (that's the only way we get credit for the work here) based on thoroughness and accuracy, rather than any good news/bad news content ... But if there's something you don't understand , please let me know.

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