Eversheds Sutherland Legal Insights (audio)

Although fines are not generally deductible, they may be deducted when attributable to restitution, remediation, or paid to comply with the law. The Tax Cuts and Jobs Act clarified these rules and the IRS has recently proposed regulations that delineate the distinctions between non-deductible fines and deductible government payments. The proposed regulations also describe the conditions and standards of proof for securing deduction as well as the IRS reporting requirements.