When tax season is near, and if you are seeking to deduct legal fees as part of your tax return, it is essential to be aware of the eligible expenses. It's important to know which legal expenses can be considered tax deductions. If you have incurred legal fees to collect, receive, or secure child support or spousal support, you have the option to deduct those fees on line 221 of your income tax return. However, it's crucial to remember that only the parent or spouse receiving the support can claim their legal fees as a deduction.
Learn More About Tax-Deductible Legal Fees
The tax-deductible legal fees may relate to collecting late support payments, establishing an amount for support payments, or efforts to vary support to a higher amount. Unfortunately, legal fees paid to get a separation or divorce, or to establish custody of or visitation arrangements for a child cannot be claimed at line 221.
Every January we review our clients’ accounts and determine the percentage of time and effort spent on their file relating to their child and/or spousal support claims. We then send our clients who qualify for the deduction, letters outlining our opinion of the percentage of their legal fees they are entitled to deduct. The client can provide their letter to CRA as a receipt.
We offer these letters free of charge to our clients because we believe that individuals and families should enjoy the maximum income and benefits available to them by law.
To gain further insights into tax and family law, we recommend consulting the "Tax Matters Toolkit for Clients," a publication by the Canadian Bar Association. It offers valuable information on these subjects and is accessible here. If you require assistance with family law services in Nova Scotia, feel free to reach out to us. We are here to help. Remember, you may be eligible to deduct legal fees related to these matters.
