Unfortunately, personal legal costs are not deductible on the federal level at all. Personal legal costs may be deductible in some states if they follow the pre-2018 rules; those rules specify that you can deduct legal costs related to the production of taxable income, but not general legal costs. So it would depend on whether there is taxable income from the land. This often means farm or forestry or oil and gas lands, but can include land held for investment purposes and sold for a profit. (The settlement might count, but it depends, see below.) And the actual benefit you will see on your state taxes depends on all your income, deductions and other factors.
Whether the settlement is taxable depends on the reason for the settlement and other complicated factors. It's hard to give a comprehensive overview, it would be better to have more facts. In general, a settlement is taxable according to the type of income it replaces.
When you inherit property, you generally get a stepped-up cost basis equal to the fair market value on the date the previous owner died. Suppose you inherited 10 acres of hunting land with no dispute, in 2004, and the value at the time was $1,000 per acre or $10,000. You sell it in 2024 for $25,000. You have a long term capital gain of $15,000--the entire proceeds is not taxable, just the amount over the stepped up cost basis. Now suppose that you inherited this property with 4 siblings, but there was a dispute that went to court, and in 2024 you received a check for $5000 (1/5 the value). Your adjusted basis is $2000 (1/5 the fair market value in 2024) so that means that only $3000 is taxable, and it is taxable as a long-term capital gain, not ordinary income. You would report it as a capital gain as if you sold inherited property, not as miscellaneous income. And, since 60% of the check is taxable, you could list 60% of the attorney fees as a tax deduction (miscellaneous itemized expense) even though that deduction will only appear on your state return.
Cash you inherit is never taxable, so if this represents (for example) cash that was in the deceased's safe deposit box, and you got a portion of the cash, then it is not taxable income and none of the legal expenses are deductible. If it is tangible property (something you can hold, like jewelry or a car) or investments (like stocks or bonds) then you follow the same rules as for real estate--the property receives a stepped-up basis and your capital gain is the difference between the basis and the "Selling price" (which is the settlement amount).
