Carl
Level 15

Deductions & credits

If the business was a corporation that filed either an 1120 or 1120-S tax return, then you should have shown your out-of-pocket payments as capital contributions to the business, and let the business pay those legal fees and other stuff. That would then give you a "capital loss" on your K-1 (for an S_Corp) that could be claimed as such on your personal return.

Otherwise, depending on circumstances (to many to cover here) your legal fees just flat out may not be deductible by you on your personal 1040 tax return at all.