DianeW777
Employee Tax Expert

Deductions & credits

The repayment should be indicated as to what amount is being repaid for each year. Apply the repayments to the appropriate years as closely has you can based on the information you received about the repayment.  Keep your records with your return. Proceed to determine the credit for each year with the knowledge and information you from the lawyer. 

 

You can prorate the repayment based on the amount you paid tax on in each year less the amount for legal fees that was not repaid. (amount of taxable income for each year, divided by the total taxable for all years, then use that percentage times the total repayment to arrive at the amount of repayment for each tax year).

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