The IRS offers a long list of income tax deductions for taxpayers which includes legal fees for certain people. If you had a DUI charge this year, then you are probably wondering if your defense costs will be tax deductible when you file income taxes. The answer isn’t as simple as you might expect and along with this basic overview, you should consult your Attorney for advice

The IRS divides deductions, also called write-offs, into two basic categories. To determine whether or not you can use your DUI defense costs as tax deductions, you must first identify which group of taxpayers you belong to.

First, there are write-offs for normal, non-business taxpayers. This includes the standard deduction and itemized deductions. Taxpayers can choose to itemize deductions instead of using the standard deduction. Itemized deductions include medical costs, mortgage interest, income and sales taxes, donations and more.

The second group of tax deductions is designated for independent contractors and business owners. Business owners and anyone who claims 1099 income can deduct almost any costs related to their business. For example, vehicle mileage that pertains to business use can be deducted, along with professional fees, equipment, office supplies and more.

Whether or not DUI defense costs can be deducted from income taxes varies based on which group of taxpayers you belong to. While legal fees are never tax deductible for non-business taxpayers, it is possible to deduct DUI defense costs if they were in connection with your business. In order to deduct theses legal fees at tax time, you must have been acting in an income-producing activity at the time the DUI occurred. If the incident did not occur at a time when you were performing duties directly related to continuing your business, your DUI legal fees will not be eligible for use as tax deductions.

Even if you take your legal costs as a deduction in the right circumstance, the IRS can still challenge you. Simply put, it can be difficult to prove that a DUI happened in relation to business. IRS tax code changes frequently, and rulings are often set on precedent. This means that if you deducted your DUI defense costs at tax time, and the IRS challenged the matter, all involved parties would look at previous rulings for direction.

One such ruling, Hylton vs. Commissioner, is often used as a precedent in cases where taxpayers have used legal costs as a deduction in relation to keeping their job. It was decided that Hylton could not deduct legal fees based on the basis that he would have lost employment if he hadn’t been driving.

Defense costs can be difficult to prove as business deductions, but with careful consideration, it can be done. The DUI must have happened in strong relation to business activities, and not simply to prevent unemployment. If you plan on taking DUI costs as a tax deduction, consult a tax professional first. A CPA, accountant, enrolled agent or other tax preparer will be abreast of current tax code, and they will be able to provide you with the latest strategy for deducting DUI costs as business expenses.