Investment Advisor Fees

[erica28]

I have a managed account, a managed traditional IRA, and a managed Roth IRA. Should I enter the investment advisor fees for all of these accounts in the federal TurboTax (in hopes that they will port over to my state return)? Or does it depend on whether the account is tax-deferred or tax-exempt, plus whether the fee was paid out of the account or from elsewhere? Thank you in advance for any tips you can provide.

[macuser_22 · Accepted solution]

The 2017 Tax Cuts and Jobs Act eliminated that Federal deduction for 2018-2025, but it might still be a deduction is some states.

[erica28]

Thank you for your response, @macuser_22! From what I've been reading, I think my state is one of those that didn't conform to the feds.

[tco0243]

I have a local financial advisor I meet with in person, and gave a one-time payment to develop a financial plan. This is not the faceless investment management fees that are built into mutual funds etc you buy thru a broker. Can I deduct the payment to my financial advisor?

[DaveF1006]

These are no longer deductible from federal taxable income but some states do allow investment advisory fees to be deducted as itemized deductions if you are able to itemize on your state return. To enter:

1. Log into Turbo Tax
2. Go to Federal>deductions and credits
3. Retirement and investment
4. other investment expenses.

[mitzeljh]

I cannot enter Investment Advisor Fees as a deduction because the entry box is grayed out (2021 Turbotax deluxe for desktop). I should be able to enter it because CA still allows the deduction.

[FangxiaL]

Here is how to enter Investment Advisor Fees on federal return which will carry over to your CA state return:

Within federal taxes:

1. Go to Deductions & Credits, then Retirement and Investments section
2. Click Start next to Other Investment Expenses
3. On next screen, select Enter my expenses
4. On next screen, you will be able to enter the amount of investment advisor fees.
5. When you enter this, your investment expenses will appear on your Schedule CA form.

[jlbrown813]

Hello, for state purposes do I enter all investment advisory fees or just those related to taxable investment accounts. My advisor breaks them out so wondered if I can only include the fees related to taxable accounts.

[RachelW33]

It depends.  You can include the advisory fees paid for all of your investment accounts as long as they were paid with "outside taxable dollars".   

For example, if you paid advisory fees for an IRA account directly (not from with the IRA account), you can include those fees. 

And as you mentioned, this is only applicable if your State allows a deduction, as Federal does not.

@jlbrown813