7920 / May an individual deduct the fees charged by a bank with respect to an interest bearing account on which checks may be drawn?
It depends. Fees charged by a bank for the privilege of writing personal checks rather than for maintaining the interest-bearing account are personal in nature and are not deductible.1 However, fees charged by a bank for the management of a money market deposit account, which requires a minimum balance and limits check writing and pre-authorized transfers, are treated as a “miscellaneous itemized deduction” because they are paid or incurred by the individual for the management, conservation, or maintenance of investments held for the production of income.2
“Miscellaneous itemized deductions” are deductible only to the extent that the aggregate of all such deductions exceeds 2 percent of adjusted gross income (see Q 733). However, note that all miscellaneous itemized deductions subject to the 2 percent floor were suspended for 2018025.
1. Rev. Rul. 82-59, 1982-1 CB 47.