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alladmail
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How can I deduct legal expenses in 2016 for a property that was disposed of in 2015?

I sold a property at the end of 2015, but had a legal dispute with a former tenant and incurred legal fees and such in 2016.  How can I deduct legal fees incurred trying to recoup damages to the property - there was not damage recovered in 2016 (no income to offset expenses against in 2016).

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New Member

How can I deduct legal expenses in 2016 for a property that was disposed of in 2015?

Generally,you can deduct attorney or accounting fees that are necessary to produce or collect taxable income.

The expenses must be directly related to the income or income-producing property, and the income must be taxable to you.

The deduction for most income-producing expenses is subject to a 2% limit that also applies to certain other miscellaneous itemized deductions. 

The amount deductible is limited to the total of these miscellaneous deductions that is more than 2% of your adjusted gross income.

alladmail
New Member

How can I deduct legal expenses in 2016 for a property that was disposed of in 2015?

Typically legal fees are deductible for rental properties without the 2% limitation, but my question is how do I deduct those fees (what form do I use / how do I enter them in turbo tax) for a property that was sold in 2015 but expenses were incurred in 2016, thanks.
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