Income Tax Service For Small Businesses - IRS denied the taxpayer’s deduction for a portion of legal fees incurred for challenging his reassignment from research to clinical pursuits by his university employer. The taxpayer claimed that the legal fees were legitimate business expenses, since his research led to the receipt of a profit-making patent. The court agreed. However, it allowed only a portion of the claimed expenses. The taxpayer deducted $17,600 in legal fees on his 2007 tax return (of which $17,500 was claimed at trial) but had paid $10,000 of that amount in 2006. As a cash-basis taxpayer, he therefore lost the portion of the claimed expenses above those paid in 2006 and was subject to a Sec. 6662(a) accuracy-related penalty as well.
We're happy to help! For no obligation free consultation contact us today!
(952) 583-9108
No comments:
Post a Comment