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blloydrn
New Member

How to report my share of court-approved attorney fees and settlement administration costs from a lawsuit settlement?

This was for back pay from the VA from Mercier Class Settlement Trust.
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1 Reply
AmyC
Expert Alumni

How to report my share of court-approved attorney fees and settlement administration costs from a lawsuit settlement?

You can claim that as an adjustment on sch 1. Follow these steps:

  1. go to the federal income section
  2. scroll to the bottom
  3. Miscellaneous Income, 1099-A, 1099-C, Start
  4. Scroll to the bottom
  5. Other reportable income, Start
  6. Other taxable income?
  7. Select YES
  8. Description Approved Legal Fees 
  9. Amount, enter your amount as a negative
  10. continue

 

Reference: Publication 525, page 33.

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