I received an inquiry about the deduction of tax planning (as opposed to financial planning) expenses.

I always thought that tax planning expenses were deductible, on Schedule A subject to the 2% limitation. But in looking around I haven't been able to find authority for that.

Am I off base?

Thanks for any comments.


--
Stu
http://DownToEarthLawyer.com

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On Thursday, July 6, 2023 at 11:56:06 AM UTC-7, Stuart O. Bronstein wrote:

I received an inquiry about the deduction of tax planning (as opposed to financial planning) expenses.

I always thought that tax planning expenses were deductible, on Schedule A subject to the 2% limitation. But in looking around I haven't been able to find authority for that.

Am I off base?

Thanks for any comments.

--
Stu
http://DownToEarthLawyer.com

TCJA 2017 suspended deductions called "miscellaneous itemized deductions" that were deductible to the extent they exceeded 2% of a taxpayer's adjusted gross income. The suspension is from 2018 through 2025.

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Alan <tempuser@vacationmail.com> wrote:

Stuart O. Bronstein wrote:

I received an inquiry about the deduction of tax planning (as opposed
to financial planning) expenses.

I always thought that tax planning expenses were deductible, on
Schedule A subject to the 2% limitation. But in looking around I
haven't been able to find authority for that.

Am I off base?

Thanks for any comments.

TCJA 2017 suspended deductions called "miscellaneous itemized
deductions" that were deductible to the extent they exceeded 2% of a taxpayer's adjusted gross income. The suspension is from 2018 through
2025.

Thanks. I knew that some deductions were eliminated, but I didn't realize
that all miscellaneous itemized deductions were.


--
Stu
http://DownToEarthLawyer.com

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On Thursday, July 6, 2023 at 9:42:45 PM UTC-7, Stuart O. Bronstein wrote:

Alan <temp...@vacationmail.com> wrote:

Stuart O. Bronstein wrote:

Thanks. I knew that some deductions were eliminated, but I didn't realize that all miscellaneous itemized deductions were.

Not ALL misc. itemized deductions. Just those subject to the 2% of AGI limitation.
See page A-12 in the Form 1040 Schedule A instructions for the list of those still allowed.
https://www.irs.gov/pub/irs-pdf/i1040sca.pdf

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Alan <tempuser@vacationmail.com> wrote:

Stuart O. Bronstein wrote:

Alan <temp...@vacationmail.com> wrote:

Stuart O. Bronstein wrote:

Thanks. I knew that some deductions were eliminated, but I didn't
realize that all miscellaneous itemized deductions were.

Not ALL misc. itemized deductions. Just those subject to the 2% of
AGI limitation. See page A-12 in the Form 1040 Schedule A instructions
for the list of those still allowed. https://www.irs.gov/pub/irs-pdf/i1040sca.pdf

Right. Thanks again.

--
Stu
http://DownToEarthLawyer.com

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Do check your state's tax treatment of them, though, as it may differ from the Fed. California, for example, did not conform to the elimination of the deductions in question, so they are still good on CA return.

========================================= MODERATOR'S COMMENT:
Marla - please include in your message the part of the prior message you
are responding to.

Thanks.

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On Thursday, July 13, 2023 at 6:47:14 PM UTC-4, Maria Ku wrote:

Do check your state's tax treatment of them, though, as it may differ from the Fed. California, for example, did not conform to the elimination of the deductions in question, so they are still good on CA return.

========================================= MODERATOR'S COMMENT:
Marla - please include in your message the part of the prior message you
are responding to.

Thanks.
--

NY also allows the miscellaneous itemized deductions subject to 2% AGI which have been suspended under TCJA.

Ira Smilovitz, EA
Leonia, NJ

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