Fines & Penalties

[DRS19]

An audit of a grocery store business resulted in fines & penalties for the business because an employee allowed a customer to purchase products that were not allowed to be purchased with food stamps.  Under these circumstances would these fines & penalties be an allowed deduction on Schedule C.   

[George4Tacks · Accepted solution]

I vote no. Violations of law produced these fines & penalties and they are not deductible. 

[ljr]

Fines and Penalties are never deductible.

and just to confirm our friend Google agrees when I doubled checked

[IRonMaN]

I’ll second George’s no

[BobKamman]

Who did the audit?  How did they come up with the amount owed?  Was it the Department of Agriculture, and they said "you sold $500 worth of stuff that did not qualify, so you owe us $500?"  That's called restitution, and it's deductible.

Sometimes facts are useful before jumping to conclusions.  

[IRonMaN]

No jumping here.  Someone said their client paid fines and penalties.  I'll take them at their word rather than play Jeopardy and pick a question rather than an answer.

[DRS19]

I agree that they are not deductible.  I just wanted to reach out and make sure you agreed with what I was thinking.  Thanks again for your answers.