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Legal fees for a discrimination or wrongful termination claim

Up to the taxable award

Can You Write Off Legal Fees for a Discrimination or Wrongful Termination Claim?

Short answer: Yes: attorney fees for employment discrimination and whistleblower claims are deductible above the line, up to the taxable award.

Damages for physical injury or sickness are tax-free; lost wages, interest, punitive damages, and emotional distress without physical injury are taxable.

Records to keep: Keep receipts, statements (1098, 1098-T, 1099, W-2G), and a note of what each cost was for. Compare itemizing to the 2026 standard deduction before you claim.