Are Business Attorney Fees Tax Deductible? Yes — Here's How to Claim Them on Schedule C
100%
Deductible
Line 17
Schedule C
Legal and professional services
Category
Legal fees for legitimate business purposes—like forming your LLC, drafting contracts, or protecting intellectual property—are fully deductible business expenses. These costs reduce your taxable income dollar-for-dollar on Schedule C. However, the IRS distinguishes strictly between business legal fees and personal legal expenses; only the business portion qualifies.
Who qualifies?
Self-employed individuals, sole proprietors, freelancers, and single-member LLC owners can deduct business attorney fees. You must have incurred the legal expense for a legitimate business reason (not personal matters like divorce or criminal defense).
How to claim it
- 1 Gather all invoices and receipts from your attorney, clearly showing the business purpose (e.g., 'LLC formation,' 'contract review,' 'trademark registration').
- 2 Add up total deductible legal fees for the tax year.
- 3 Enter the total on Schedule C, Line 17 (Legal and professional services) as part of your self-employment income calculation.
Pro tip
If your attorney's invoice covers both business and personal matters, ask for an itemized breakdown and deduct only the business portion. Keep detailed records of what each legal service accomplished for your business—the IRS may request documentation during an audit.
Source: IRS Publication 535: Business Expenses
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