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Can legal fees in connection with loan modification (1099-C issued) be deducted for investment property?

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Level 1

Client had a loan modification of $172K on a rental property.  Received a 1099-C.

Can the legal fees associated with the loan modification be deducted on Sch E?

Thank you, Gurus

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Level 15

Generally legal fees for the protection or production of income are deductible, so I would say yes. 


ex-AllStar

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Level 15

Generally legal fees for the protection or production of income are deductible, so I would say yes. 


ex-AllStar

View solution in original post

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Level 1
Thank you for your answer. I was also told to amortize it over the life of the loan
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