Quick Answer
Personal will and estate planning costs are generally not tax-deductible for individuals after the Tax Cuts and Jobs Act eliminated miscellaneous itemized deductions. However, business-related estate planning and trust tax preparation fees may still be deductible. The average estate plan costs $3,500, with none of it deductible for most taxpayers.
Best Answer
Michelle Woodard, JD
Best for wealthy individuals with estates over $5 million involving business succession planning
Personal estate planning costs: Generally not deductible
For most individuals, the cost of preparing a will, trust documents, or personal estate plan is not tax-deductible. The Tax Cuts and Jobs Act of 2017 suspended miscellaneous itemized deductions subject to the 2% AGI threshold through 2025, which included estate planning fees.
Prior to 2018, you could deduct estate planning fees as miscellaneous itemized deductions if they exceeded 2% of your adjusted gross income. This deduction remains suspended through the 2026 tax year.
Business-related estate planning: Still deductible
While personal estate planning costs aren't deductible, business-related components may qualify for deductions:
Business succession planning: Legal fees for creating buy-sell agreements, succession plans, or business valuations for estate tax purposes are deductible business expenses.
Trust tax preparation: Fees paid to prepare trust tax returns (Form 1041) are deductible by the trust, not subject to the 2% AGI limitation that affected individual returns.
Estate tax return preparation: Fees for preparing Form 706 (estate tax return) are deductible by the estate.
Example: $500,000 business with estate planning
Consider a business owner with a $500,000 company who pays $8,000 for comprehensive estate planning:
The business can deduct $4,000 ($2,500 + $1,500) as professional fees, but the $4,000 in personal estate planning costs provides no current tax benefit.
Strategies for high earners
Separate business and personal fees: Ensure your attorney bills business succession planning separately from personal estate planning. Only the business portion is deductible.
Trust structures: Consider irrevocable trusts that pay their own tax preparation fees. These fees are deductible by the trust at ordinary income rates.
Timing considerations: While current estate planning isn't deductible, some costs may provide future benefits. For example, detailed documentation can reduce probate costs or executor fees.
What about future changes?
The suspension of miscellaneous itemized deductions expires after 2025. Starting in 2026, estate planning fees may again become deductible as miscellaneous itemized deductions, subject to the 2% AGI threshold.
However, high earners should note that miscellaneous itemized deductions are also subject to the alternative minimum tax (AMT) limitations, which could reduce or eliminate their benefit.
Estate administration vs. estate planning
It's important to distinguish between estate planning (preparing for future events) and estate administration (managing affairs after death):
Estate planning costs: Generally not deductible
Estate administration costs: Deductible by the estate, including attorney fees, accounting fees, and appraisal costs
What you should do
Review your estate planning bills to identify any business-related components that might be deductible. Use our return-scanner tool to check if you've missed any deductible professional fees from business succession planning or trust administration.
[Scan Your Return →]
Key takeaway: Personal estate planning costs aren't deductible, but business succession planning and trust administration fees may provide tax benefits worth an average of $800-$1,200 annually for business owners.
Key Takeaway: Personal estate planning costs aren't deductible, but business succession planning components and trust administration fees can provide valuable tax deductions.
Deductibility of different estate planning and trust costs
| Cost Type | Paid By | Deductible? | Tax Savings (Est.) |
|---|---|---|---|
| Personal will preparation | Individual | No | $0 |
| Revocable trust creation | Individual | No | $0 |
| Business buy-sell agreement | Business | Yes | $500-$925 |
| Trust tax return (Form 1041) | Trust | Yes | $300-$450 |
| Estate tax return (Form 706) | Estate | Yes | $600-$1,500 |
| Trust investment management | Trust | Yes | $625-$925 |
More Perspectives
Robert Kim, CPA
Best for small business owners considering business succession planning as part of estate planning
Business succession planning deductions
As a small business owner, portions of your estate planning may be deductible as business expenses, even though personal estate planning costs are not.
Deductible business components:
Example for $200K business:
Total estate planning cost: $4,500
You can deduct $2,000 as business expenses, saving approximately $400-$740 in taxes depending on your tax bracket.
Documentation is key: Ensure your attorney separately bills business-related services. Mixed personal/business billing makes the entire fee non-deductible.
Ongoing costs: Annual updates to buy-sell agreements or business valuations are also deductible business expenses.
Key takeaway: Small business owners can often deduct 30-50% of their estate planning costs by properly categorizing business succession components.
Key Takeaway: Small business owners can deduct business succession planning components, often 30-50% of total estate planning costs.
Michelle Woodard, JD
Best for investors using trusts for tax planning and wealth transfer strategies
Trust-related deductions for investors
Investors using trust structures have several opportunities for tax deductions related to estate planning and trust administration.
Trust tax return preparation: Form 1041 preparation fees are fully deductible by the trust, not subject to the suspended miscellaneous itemized deduction rules.
Investment management fees: Trusts can still deduct investment advisory fees and portfolio management costs that were eliminated for individual taxpayers.
Administrative expenses: Legal fees, accounting fees, and trustee fees are generally deductible by the trust.
Example: $500,000 investment trust:
Annual trust expenses:
At the trust tax rates (reaching 37% at just $15,200 of income), these deductions save approximately $1,665 in taxes.
Grantor trust considerations: If you're treated as the owner of a grantor trust, these expenses flow through to your personal return where they may not be deductible.
State differences: Some states allow deductions that federal law doesn't permit, potentially creating planning opportunities.
Key takeaway: Investment trusts retain valuable deductions that individual taxpayers lost, making trust structures increasingly attractive for high-income investors.
Key Takeaway: Investment trusts can deduct management fees and administrative costs that individual investors cannot, providing significant tax savings.
Sources
- IRS Publication 17 — Your Federal Income Tax - includes information on suspended deductions
- IRS Publication 559 — Survivors, Executors, and Administrators
- IRC Section 67 — 2-percent floor on miscellaneous itemized deductions
Reviewed by Michelle Woodard, JD on February 28, 2026
This content is for educational purposes only and is not a substitute for professional tax advice. Consult a qualified tax professional for advice specific to your situation.