Litigation
Jun. 24, 2010
Which Client Costs Are Tax Deductible?
When contingent fee lawyers pay out-of-pocket costs, it matters how the accounting is done and how the fee agreement is worded. Robert Wood of Wood & Porter explains why.
Most contingent fee lawyers cannot get a client to pay out-of-pocket costs on an ongoing basis, so the lawyer must pay them. But is the lawyer advancing the costs (to be collected later upon settlement) or simply undertaking the obligation to pay them? Does it matter how the accounting is done and how the fee agreement is worded?
Yes, it matters, and it is surprising that much of the plaintiff's bar doesn't ...
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