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Hi. My name is ***** ***** I will be happy to help you.
Your question is little confusing. What did you sell? You said you sold $65,000 25 years ago.
And the $50,000 you paid IRS were for taxes and penalties, I am assuming.
Unfortunately, federal taxes and penalties are not deductible. But you can deduct state taxes you had to pay as result of the it. You would deduct it as part of our itemized deduction in the year you paid it.
From IRS publication:
Taxes you cannot deduct:
Federal income taxes. This includes income taxes withheld from your pay.
Fines and penalties. You cannot deduct fines and penalties paid to a government for violation of any law, including related amounts forfeited as collateral deposits.
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