8962 shows incorrect AGI @ 39189 + 10858 = $ 50,850
**. LSE - SSDI $39189- $6000 ( Atty fees ) =$ 33,189.00
$10,838.00. Pension
***. Corrected AGI $33,189 + $10,858 = $ 44,047
I've been audited can I still amend to show description
of amount in box 3 ?
suggestions ? ? - thanks paula holden
You are to enter the SS benefits reported in box 5 of the form SSA-1099 ... you should not have reduced that amount by anything including attorney fees which is the error the IRS has caught and corrected.
https://secure.ssa.gov/apps10/poms/images/SSA1/G-SSA-1099-SM-1.pdf
On a personal return (1040) legal fees are generally not deductible. The two exceptions are for legal fees incurred to determine or collect any tax liability, and legal fees expended to secure taxable income.
Therefore, legal fees can be deducted to the extent Social Security income is taxable. For instance, if 50% of Social Security income is taxable, then 50% of legal fees are deductible.
To deduct legal expenses, you must have enough itemized deductions (ie. Medical, mortgage interest, property taxes, charitable giving, ect) to exceed your Standard Deduction. If you itemize, your deduction is limited to the extent that it exceeds 2% of your Adjusted Gross Income.
So, you may not gain a tax benefit for this deduction.
To report legal fees in TurboTax:
Click My Account (Top right of your screen).
Select Tools.
In the pop up window, select Topic Search.
In the search bar, type in legal expenses, deduction
Highlight it and select GO, and follow the prompts.
However, new law changes impact deductibility of certain personal legal fees. Attorney's fees that have been deductible (for 2017 and earlier years) as a miscellaneous itemized deduction subject to the 2%-of-AGI floor will no longer be deductible at all starting in 2018 - 2025.