A tax prep fee covering the 1040 and Schedule C belongs on Line 17, legal and professional services.
Why line 17
The business share goes on line 17 and the personal share is not deductible anywhere, so the allocation is the whole value of the exercise. Ask the preparer to itemise the invoice by form or by time: Schedule C, Schedule SE, Form 4562, Form 8829, the bookkeeping clean-up and the 1099 filings are business, while Form 1040 itself, Schedule A, Schedule B, Schedule D and your state personal return are not. Most preparers will do this on request, and a preparer's own breakdown is far stronger support than a percentage you estimated afterwards. Where they will only give one figure, a time-based split described in writing is the fallback.
Stop looking up lines one at a time. ClaryBook totals your year into an IRS Schedule C worksheet in form order, Part I and Part II line by line, so a tax prep fee covering the 1040 and Schedule C lands on Line 17 without you sorting it.
Start for freeWhat a tax prep fee covering the 1040 and Schedule C is confused with
- not deductible, not deductible
- The personal return portion is not deductible at all, since the miscellaneous itemised deduction that used to carry it is not currently allowed.
- Line 27a, other expenses
- Software you use to file your own return is not professional services, so a self-filing subscription is better described in Part V to line 27a at its business share.
- Line 23, taxes and licenses
- A state filing fee or franchise charge the preparer pays on your behalf is a tax or licence on line 23, not part of the professional fee.
Examples that belong on line 17
- $900 invoice itemised as $560 business forms and $340 personal: $560 on line 17
- $450 bookkeeping clean-up on the same invoice: fully business
- $1,200 invoice with no breakdown and a preparer estimate of 60% business: $720, with the estimate in writing
- $150 for the state personal return: not deductible
- $220 for preparing and filing twelve 1099-NECs: fully business
What does not belong here
- Deducting the whole invoice because the business paid it.
- The personal return share on Schedule A.
- Audit representation on a personal matter, which follows the personal side.
- Penalties and interest the preparer remits with the return, which are not deductible.
What to keep
Ask for an invoice itemised by form or by time and keep it with the return. If the breakdown is an estimate, get it in writing from the preparer rather than making it yourself, and keep the engagement letter describing the scope.
Other expenses on line 17
| Expense | Line |
|---|---|
| a registered agent's annual fee | Schedule C, Line 17 |
| an appraiser's fee | Schedule C, Line 17 |
| bookkeeper and accountant fees | Schedule C, Line 17 |
| business consultant fees | Schedule C, Line 17 |
| fractional CFO fees | Schedule C, Line 17 |
| legal fees for drafting a client contract | Schedule C, Line 17 |
| legal fees to sue a customer | Schedule C, Line 17 |
| tax preparation fees | Schedule C, Line 17 |
Related lookups
- Is a car payment deductible on Schedule C?
- Where do client gifts go on Schedule C?
- Where does a business license go on Schedule C?
Sources
This page explains how Schedule C lines work. It is general information, not tax advice for your situation. If an expense is large or the answer turns on a fact about your business, confirm it with your tax preparer.
Looking for a different expense? The full Schedule C line lookup has every line from 8 to 27 with the expenses that belong on each, and Schedule C expense categories walks the whole form in order.
Stop looking up lines one at a time. ClaryBook totals your year into an IRS Schedule C worksheet in form order, Part I and Part II line by line, so a tax prep fee covering the 1040 and Schedule C lands on Line 17 without you sorting it.
Start for free