Taxpayer asks:
Hello taxgirl,
I love your blog! My question is as follows:
I prepare taxes, so naturally I will prepare my own taxes. Can I deduct MY tax preparation fee (the fee I would charge someone else for a tax return with the same complexity)?
Thanks,
Taxgirl says:
Thanks for the nice words!
Unfortunately, I’m going to have to say no to your question. 
The idea behind claiming most deductions is that there is generally a corresponding item of income (some exceptions exist but you get the idea). So when you pay someone to do your taxes, the preparer reports it as income, you claim it as a deduction. Voila! But when you self-prepare your taxes, whether or not you’re a professional, there’s no income component. So it makes sense that there would be no deduction.
On the plus side, you can claim a deduction for out of pocket expenses paid for tax preparation software, tax publications and the costs associated with electronic filing. Those expenses, together with fees paid to a tax preparer in the year of the return (for example, fees paid in 2008 would be reported on your 2008 return) will be reported on Schedule A of your federal form 1040 as an itemized miscellaneous deduction. You have to itemize to take advantage of this deduction.
And yes, since I know some tax pro out there is gonna ask, if you paid yourself (though not sure why you’d do this), I’m thinking you could deduct it.
Like any good lawyer, I need to add a disclaimer: Unfortunately, it is impossible to give comprehensive tax advice over the internet, no matter how well researched or written. Before relying on any information given on this site, contact a tax professional to discuss your particular situation.
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{ 1 comment… read it below or add one }
Are you kidding me? I stumbled across this question while searching for something else. When this person says they “prepare taxes”, do they mean, like, professionally? I don’t know who they’re preparing taxes for, but if they’re asking whether or not they can take a deduction for time, I’m sure glad they’re not preparing my return. That’s income tax 101 stuff right there…