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Tax question for lawyers

1384 Views 31 Replies 13 Participants Last post by  DNeurococo
I was told recently that someone won a $500,000 law suit. It was appealed and the final settlement was reduced to about $325,000.
The person paid the lawyer about $125,000. They were told by two tax attorneys that they had to pay taxes on the original $500,000 award AND had to pay taxes themselves on the amount the lawyer got too.

I assume this must be right if two tax attorneys agree. :eek:
I assume that the lawyer will get taxed on the amount they received also.
First, isn't that double taxing the legal fees?
Second, why would they have to pay taxes on an amount they nere received?

Please inform the weak of legal and tax minded!

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gbrumb said:
Bassetman......What's the answer worth to you? I have structured retainer agreements to avoid this very problem. I know the answer well.

Here is the price. We know how you feel about Bush and the Terminator in California so if I answer the question you have to have the following as your signature for 48 hours: Bush is *****in :up:

It must be the only thing in your signature and it must be of regular size type. If you agree I'll post the answer, you place the above in your signature and PM when its done. The time on the PM starts the 48 hours.

Basset, do it. Regardless, thats funny. :D Gbrumb, and we wonder why everyone hates lawyers. :D
This has to be one of the better barters I have seen since, oh, when Manhattan was bought. Gbrumb, are we allowed to postulate on the answer until you give us the correct answer? :)
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