The Treasury Department is rumored to be on the verge of reversing a long-standing policy which did not help personal injury attorneys. The status quo: litigation expenses in contingency agreements are not deductible. Litigation expenses in contingency agreements are considered loans advanced to the plaintiff. Of course, if the plaintiff loses, the loan is not repaid. Then, the attorney can write off the “bad loan.”
If the Treasury Department changes its mind, litigation expenses, such as fees paid to experts, court costs, filing fees, and the like would be deductible in the year those expenses were paid.
Interestingly, legislators in the U.S. Senate and House of Representatives have tried to introduce bills that would provide trial attorneys with a statutory tax deduction for litigation costs in contingency fees cases. The result: an absence of support to even hold hearings on the issue, much less formal consideration by either chamber.
In a time when consideration is being given to raising taxes for some or all, it is ironic that one group seems poised to get a lucky break – plaintiff’s attorneys.
Should we be surprised? By watching and reading the news, we are reminded daily that government at all levels has been hijacked by the legal profession for its own self-serving benefit. They simply own it. Statutes, laws as well as decisions from the bench have simply become onerous, presumptuous and incomprehensible to even the most articulate scholar of the English language They are insulting. The President himself, a former constitutional law professor, apparently did not know that the federal government cannot force it’s citizens to purchase anything. It can only tax us. Is that what he taught his students? Amazing. The POTUS and his accomplices, a misguided group of progressive liberals, are hell-bent on transforming America into a fantasy social utopia where the government decides for us. No will have a say in planning their future and no one is responsible. This is a a national tragedy. This is akin to watching an asteroid make its way on a collision course to earth. Unless we stop it, it’s doomsday for every living thing – except, of course, the cockroaches. They seem to prevail each and every time.
Present: Physicians providing uncompensated care and being unable to deduct as a tax
loss
Attorneys able to deduct “uncompensated care” as a tax loss
To many frivolous lawsuits
Future: Physicians providing a lot more uncompensated care and still unable to deduct
as a tax loss
Attorneys able to deduct all costs
An explosion in frivolous lawsuits
It is now quite clear that the only way this is going to stop is when enough physicians quit that the public is put at risk. Sad, but looking more and more likely as time goes on.