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.
Legal fees for a discrimination or wrongful termination claim
Typical range: Up to the taxable award
Individuals / Personal Taxes
Yes: attorney fees for employment discrimination and whistleblower claims are deductible above the line, up to the taxable award.
Business justification
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.
Category
- Personal Tax Deductions