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I'm currently contemplating trying out the new SN service, and have a question regarding how subscription refunds would affect deductions.

If I pay for the SN subscription, I'm almost positive that will bring my "investing costs" above the 2% of AGI requirement for deducting the expenses. So for 2012, I should theoretically be able to deduct the subscription cost. But if I end up cancelling SN in March of next year for the full refund, how does that affect taxes? I would have deducted the expense for 2012, but does a refund of the expense in 2013 have any effect?

It's called a recovery and the refund becomes taxable in 2013 to the extent that you received a benefit from the original deduction. See IRS Pub. 525, Taxable and Nontaxable Income,

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