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Can I deduct legal expenses for (1) estate planning or (2) tax advice?

Thanks, Bill
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<<Can I deduct legal expenses for (1) estate planning >>

This is a tricky question. Legal and professional fees incurred in connection with the planning or contesting of a will are nondeductible personal expenses. Legal and professional fees incurred in estate planning however, may be partly deductible and partly nondeductible because such planning inherently involves some issues that are resolved by tax advice and some that are personal in nature. Consequently, an itemized bill should be requested from the provider of professional estate planning services.

For example, let's say that Norm hires a law firm to plan his multi-million dollar estate. The services rendered include various conferences, the preparation of wills for Norm and his wife Wanda, the establishment of an irrevocable trust for Wanda, and the preparation of gift tax returns. That portion of the fee that relates to tax advice is deductible, but the portion allocable to the services of drafting the will and trust is a nondeductible personal expense.

The portion of the fee that relates to the preparation of the gift tax returns is also deductible. If the law firm does not provide an itemized bill that clearly shows the allocation that should be made, a court will apply the percentages it feels most clearly reflect the facts before it.

So it's very likely that there are deductible expenses regarding estate planning and preparation. It's up to the planning professional to provide that information on the bill presented to you.

<<or (2) tax advice?>>

Certainly yes...no question here.

TMF Taxes
Roy
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<<or (2) tax advice?>>

Certainly yes...no question here.


I suppose this would be itemized. Would this be deductible even if the total itemized deductibles fall below the standard deductible?

Thanks.
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