Canadian Tax Preperation Fee - Deductible on U.S. return?

Alex · Post by **Alex** » Mon May 05, 2014 2:08 pm

Just wanted to check if a fee paid for personal Canadian tax preparation can be claimed as a deductible expense on U.S. personal tax returns (for USC)?

nelsona · Post by **nelsona** » Mon May 05, 2014 5:00 pm

Yes, as a miscellaneous expense subject to the 2% floor on schedule A. Not likely deductible at the end of the day unless you (a) have low income or (b) lots of other misc expenses, AND you use the itemized deductions.

And of course it is only deductible in the year you make the payment.

Alex · Post by **Alex** » Tue May 06, 2014 10:00 am

Thank you, Nelsona.

If I did include it, would I add it to the US tax preparation amount or report them separately?

nelsona · Post by **nelsona** » Tue May 06, 2014 10:07 am

Does it matter? Its an entry that will be summed together and added to a line on schedule A -- if you reach the required amount. What other misc expenses do you have?

Alex · Post by **Alex** » Tue May 06, 2014 2:59 pm

I thought I had land transfer tax from a home purchase, but I see from another post here that it is not deductible, so probably itemized deductions are not worthwhile for me. Thank you.

nelsona · Post by **nelsona** » Tue May 06, 2014 3:56 pm

I think you are missing the point.
Whether or not you have other eligible deductions, tax prep is in a subcategory in which it is rare that one has sufficient amount to claim.

Alex · Post by **Alex** » Tue May 06, 2014 4:59 pm

Sorry to be slow - I think I understand now.

In addition to accounting fees I have union dues as miscellaneous deduction expenses. Together they add to less than 4k.

nelsona · Post by **nelsona** » Tue May 06, 2014 5:06 pm

Well, if you have other deductions, like property tax, mortgage interst, etc, it may be worth looking into.
In any event, you enter all the deductions into your software and let it decide.

But, It appears you live in Canada, no? If so, then why are you worried about deductions on 1040, you should not owe any tax anyways to IRS by simply using the standard filing method.