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Disputing legal fees allowed by former lawyer for tax purposes

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  • Disputing legal fees allowed by former lawyer for tax purposes

    So I fired my first family lawyer. She was nice person- and sort of competent...but she was a collaborative lawyer and was getting woefully out-lawyered by my ex's lawyer.

    She and her boss (namesake of firm) were not happy. When it came time for me to ask them for the letter stating what portion of their fees I could claim for my taxes- they chose the smallest amount possible. I've written back formally disputing this amount- citing the amount of conversations- and requests we made for child support (they were at least good with detailed accounts- which helps my case)

    Obviously I want to claim a higher amount- but if I do so, and get assessed- I can't rely on their letter.

    Anyone else dispute this? Even if I do get assessed- can I bring my dispute to the CRA?

  • #2
    Good luck with CRA being helpful...I just posted my own issues with CRA on the Divorce Support section.
    You would need overwhelming proof that these fees were incurred ...and even then CRA can say it's not enough evidence for them.
    In my dealings with them - (if you have evidence/documentation) you have to challenge them right up through to the appeals section before you seem to get someone competent.
    Sorry to be a wet blanket.

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    • #3
      They aren’t just difficult for divorce stuff. I had to dispute both my own and my fiancé’s taxes when they messed it up. My sister has also been audited three times with pretty basic taxes.

      For the fees issue, this isn’t CRA, this is the law firm. May want to talk to the law society too if it gets difficult.

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      • #4
        Your matter is between you and the lawyer. What component of work they did for CS and SS is very subjective. The LSUC may be able to help you but, that process is slow. You are not disputing the actual bill but, how it was spent. If they didn't book their time on it being specifically time spent on SS and CS it isn't tax deductible I think.

        Your matter is complex. The other question I would ask of the community is what % of their bill was allocated towards CS and SS dispute.

        Say someone spent 100,000k to go to trial and was successful. Of the 100,000 what % was deemed applicable to the CS and SS element of the case. 20%? 30%? You would need a few responses to really know what is a reasonable balance. Again, each case is unique so this may not even be a good way to judge if what was billed against SS and CS work for the purposes of tax filings.

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        • #5
          Check this out very carefully. I was/am able to claim legal fees for sure for "defending" existing spousal support order. I believe I was able to claim for establishing and negotiation of said spousal support order as well. I was NOT able to claim anything pertaining to the divorce. How your lawyer words the letter, and accompanying bills, to CRA is important. All I ever had to do when being audited was submit letter from law firm and supporting documentation (invoices and copy of MEP statement).

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