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Maximizing Tax Deductions Before December 31: A Guide for Attorneys
You work hard all year. So why hand over more of your profit to the IRS than necessary?
For attorneys and law firm owners, year-end is more than just wrapping up cases—it’s your final chance to capture every legitimate deduction you’ve earned. And yet, every April, we meet lawyers who missed thousands in write-offs simply because they didn’t act in time or track them correctly.
This isn’t just about saving money. It’s about protecting your cash flow, reducing audit risk, and building a smarter financial foundation for 2026.
At Prestige Accounting & Consulting, we work exclusively with lawyers. This guide walks you through the most overlooked deductions, compliance tips, and what you need to do before December 31 to take full advantage.
🧾 Why Year-End Timing Matters
The IRS only cares about what’s recorded by December 31. If your deduction doesn’t hit the books this year—you lose it.
The biggest mistake we see? Lawyers leaving deductions on the table because:
- They didn’t track expenses consistently
- They paid for items in January they could’ve paid in December
- They didn’t know what they could deduct in the first place
That’s what this article solves.
💡 Commonly Missed Deductions for Lawyers (You Still Have Time to Use)
1. Continuing Legal Education (CLE) and Professional Development
CLEs aren’t just required—they’re deductible. That includes:
- Course registration fees
- Travel (see mileage section below)
- Lodging and meals (subject to 50% rule)
- Webinars and digital training subscriptions
Pro Tip: Pay now for 2026 CLEs to get the deduction in this tax year (if on cash basis accounting).
2. Mileage & Local Travel
Yes, driving counts. But you must track it accurately. Most lawyers underclaim this because they don’t log short client trips or court runs.
2025 IRS standard mileage rate: TBD (2024 was 67 cents per mile for business).
Include:
- Driving to court
- Client meetings
- Local networking events
- Trips to the bank, post office, etc.
📲 Use apps like MileIQ or QuickBooks Self-Employed for automatic tracking.
3. Home Office Deduction
If you run your firm (or part of it) from home, this may be one of your most powerful deductions—especially for solos or hybrid setups.
Requirements:
- Exclusive and regular use of a defined space in your home
- Principal place of business for admin or client work
Choose:
- Simplified method: $5/sq ft up to 300 sq ft
- Actual expenses method: % of rent/mortgage, utilities, internet, etc.
This deduction also opens the door to home-based expenses like a portion of your property insurance, HOA dues, and repairs.
4. Legal Tech & Subscriptions
Law firms run on software—so don’t forget to deduct it:
- Case management (e.g., Clio, MyCase)
- Billing tools (e.g., LawPay, QuickBooks)
- CRM platforms
- Legal research subscriptions
- Scheduling and communication tools
Also deductible:
- Laptops, phones, printers
- Web hosting and domain renewals
- Cybersecurity software
🧠 Reminder: If you’re on cash basis, pay for 2026 subscriptions now to deduct them in 2025.
5. Marketing & Brand Building
The IRS allows deductions for marketing expenses designed to generate revenue.
Include:
- Website design & maintenance
- SEO or paid ad services
- Graphic design
- Professional photography
- Content creation or blog services
- Business cards, branded folders, etc.
What’s not deductible? Entertainment disguised as “marketing” without a business purpose.
💳 Prepaying Expenses: Smart or Risky?
The IRS allows you to prepay certain deductible expenses (within reason), but it must:
- Be a legitimate business need
- Be used within 12 months
- Align with your firm’s normal operations
Great candidates to prepay:
- Software renewals
- Bar association dues
- CLE credits
- Equipment or office upgrades
Avoid:
- Prepaying rent (not usually deductible early)
- Making arbitrary vendor payments without documentation
Consult with a CPA who works specifically with lawyers (that’s us) to ensure compliance.
👀 Audit-Proof Your Deductions
Want to deduct with confidence? Follow these rules:
- Keep detailed receipts (not just credit card statements)
- Note business purpose for travel or meals
- Maintain a mileage log
- Use separate accounts for personal and business expenses
- For home office: sketch the square footage, take photos, and document your business use
Bonus: Set up cloud-based storage (like Google Drive or Dropbox) to archive proof in case of an IRS notice later.
💰 Don’t Forget Section 179 and Bonus Depreciation
If you purchase qualifying equipment or software before year-end, you may deduct the full amount up to:
- $1,220,000 under Section 179 (2025 limit)
- 60% bonus depreciation (2025 phase-down from 80%)
It must be:
- In service by December 31
- Used 50%+ for business
Qualifying items:
- Office equipment
- Technology
- Certain improvements to leased office space
Plan your purchases wisely—don’t spend just to save.
📉 Don’t Leave Money on the Table in Q4
We get it—December is hectic. But that’s exactly why you should act now.
Here’s what you should do this month:
- Pull a YTD profit & loss report
- Cross-check expenses against this list
- Meet with a legal CPA to explore missed deductions
- Log your mileage, receipts, and home office info
- Prepay expenses where it makes sense
📅 Pro Tip: Run a deduction audit before Thanksgiving so you have time to course-correct.
🎯 CTA: You Handle the Law—Let Us Handle the IRS
If you’re not sure what applies to you, or you suspect you’re missing deductions, it’s time to stop guessing.
🎯 Let’s review your books, fix compliance gaps, and build a strategy that keeps more of your money in your firm.
