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Generally, you can't deduct fees paid for advice or help on personal matters or for things that don't produce taxable income.
This is where it gets tricky. The statement above (which is cited from the IRS) makes it seem that the attorney's fees would be deductible if you had itemized medical expenses. Unfortunately due to the nature of the Tax Benefits Rule the repayment of the prior Itemized Deduction only reverses a previously taken stance therefore the Settlement remains Non-Taxable Income so you cannot deduct attorney's fees in any case.
Generally, you can't deduct fees paid for advice or help on personal matters or for things that don't produce taxable income.
This is where it gets tricky. The statement above (which is cited from the IRS) makes it seem that the attorney's fees would be deductible if you had itemized medical expenses. Unfortunately due to the nature of the Tax Benefits Rule the repayment of the prior Itemized Deduction only reverses a previously taken stance therefore the Settlement remains Non-Taxable Income so you cannot deduct attorney's fees in any case.
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