Where do accountant and legal fees go on Schedule C?
Line 17 — Legal and professional services
Fees paid for professional advice about your business go on Schedule C Line 17, 'Legal and professional services'. This covers bookkeeping, tax preparation attributable to the business schedules, business legal advice, and contract drafting. Personal legal costs are not deductible, and the portion of a tax-return fee relating to your personal return is not a business expense — ask your preparer to split the invoice.
Examples
- Monthly bookkeeping for the business.
- A lawyer drafting your client contract.
- The business share of your tax preparation fee.
Watch out for
- Legal fees to acquire an asset are usually added to the asset's cost rather than expensed.
- Keep engagement letters as well as invoices.
- Fees paid to a contractor doing your actual client work belong on Line 11 instead.
Stop guessing the category
DocuSpending reads each receipt and assigns the Schedule C category for you, then totals the year on demand.
General information, not tax advice. Amounts, limits, and percentages change between tax years — check the current IRS Schedule C instructions or ask a tax professional about your situation.
Get DocuSpending updates
Join the list for product updates and receipt-organization tips. By joining, you agree to receive these emails. You can unsubscribe when emails begin.