topic I was sent a C&D from otterbox's lawyers and we settled with me paying them $500 because I sold an phone case without their permission. Can I claim that as an expense? in After you file

I was sent a C&D from otterbox's lawyers and we settled with me paying them $500 because I sold an phone case without their permission. Can I claim that as an expense?

westleyramsey — Mon, 23 Feb 2026 10:41:25 GMT

Re: I was sent a C&D from otterbox's lawyers and we settled with me paying them $500 because I sold an phone case without their permission. Can I claim that as an expense?

Anonymous_ — Thu, 19 Jan 2023 19:38:30 GMT

In relation to your business? If so, you can likely claim the payment as a business expense.

Re: I was sent a C&D from otterbox's lawyers and we settled with me paying them $500 because I sold an phone case without their permission. Can I claim that as an expense?

westleyramsey — Thu, 19 Jan 2023 19:58:30 GMT

Yes it was for my business. I was thinking maybe I could claim it under legal and professional fees?

Re: I was sent a C&D from otterbox's lawyers and we settled with me paying them $500 because I sold an phone case without their permission. Can I claim that as an expense?

Anonymous_ — Thu, 19 Jan 2023 19:59:43 GMT

Is your business selling phone cases and accessories?

Re: I was sent a C&D from otterbox's lawyers and we settled with me paying them $500 because I sold an phone case without their permission. Can I claim that as an expense?

westleyramsey — Thu, 19 Jan 2023 20:42:19 GMT

I resell everything from clothing to electronics. I was selling some phone cases when it happened but have since decided not to sell cases anymore.

Re: I was sent a C&D from otterbox's lawyers and we settled with me paying them $500 because I sold an phone case without their permission. Can I claim that as an expense?

Anonymous_ — Thu, 19 Jan 2023 20:54:00 GMT

Probably just add the $500 to your cost of goods sold.

Re: I was sent a C&D from otterbox's lawyers and we settled with me paying them $500 because I sold an phone case without their permission. Can I claim that as an expense?

Opus 17 — Thu, 19 Jan 2023 21:07:58 GMT

You can't deduct legal fees incurred by the business if you do something illegal. However, this is a contract dispute, so you can deduct the legal fees.