Tax Research

Payment of Ex-Spouse’s Divorce Attorney’s Fees, Writing a Client Letter Facts:

Your client, Norman Westerly, was formerly married to his ex-wife, Maria Eastman. Although Norman and Maria ultimately reached an agreement regarding the division of their property, their divorce was drawn out and litigious. Each party’s attorney spent many hours representing them during the divorce proceeding, which resulted in substantial legal fees being separately incurred by both Norman and Maria. As he was ordered to do by the divorce judge, Norman paid $25,000 of Maria’s divorce attorney’s fees to Maria’s attorney. Norman would like you to determine whether his payment of Maria’s divorce attorney’s fees is deductible for federal income tax purposes.

Required:

First Step: Identify the relevant Code sections and regulations and find a court decision that is relevant to Norman’s situation. Be sure to check the citator to make sure that the case is current and that subsequent authority has not affected the precedential value of the decision.

Second Step: Based on your findings in the first step, write a brief letter to Norman telling him whether or not he can deduct the $25,000 he paid to Maria’s divorce attorney.