Most lawyers who handle Social Security disability cases charge a standard fee of 25% of your past-due benefits, with a cap of $6,000.
The IRS emphasized that Social Security benefits and Social Security Disability Income (SSDI) do not count as earned income. rior to the Tax Cuts and Jobs Act, the IRS allowed you to deduct attorney fees as long as the fees were related to a tax issue or to producing taxable income.
The Tax Cuts and Jobs Act eliminated miscellaneous deductions, which was where Social Security lawyers fees were previously claimed. Even at that, though, your deductions combined would have needed to exceed the standard deduction. For many people, the standard deduction will be higher than any itemized deductions they would have claimed since it is now $12,000 for single filers and $24,000 for those married filing jointly.
The IRS classifies attorney fees as a miscellaneous itemized deduction. ... In the case of a disability claim, the fees are deducted from your back benefits before Social Security pays those benefits to you; therefore, the fees are paid in the year Social Security makes the attorney fees deduction.
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