form 4684 can i use it for theft

4 replies
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i loss money due to someone scamming me

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DoninGAAnswer

Level 15

Casualty and theft losses are not deducible on a federal tax return unless they occurred in a federally declared disaster area.

DoninGA

Answer

Level 15

Casualty and theft losses are not deducible on a federal tax return unless they occurred in a federally declared disaster area.

taxpayer7374

Level 2

Hi dj

I have been the victim of scamming as well. looking into the possibilities for claiming deductions. the only seeming possibility if you were the victim of a ponzi scheme in which you were "investing" with the expectation of returns. you also need to have filed a police report ( I suggest FBI as well) and have records of your "investment " transactions and records and they need to match up with your actual withdrawals

xmasbaby0

Level 15

@taxpayer7374 Sorry---theft and casualty losses are not deductible unless the theft was the result of being a vicim of a Ponzi scheme; casualty losses are only deductible if they occurred as a result of being in a federally declared disaster area.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

Mike9241

Level 15

the article seems to reach a different conclusion regarding Ponzi losses as long as the objective was to earn a profit. It seems to conclude that such a loss does not have to be in a federally declared disaster area.

https://www.journalofaccountancy.com/issues/2025/jul/deductibility-of-theft-losses-for-victims-of-certain-scams/

furthermore pub 547

Note that the personal-use property limitation for tax
years 2018 through 2025 does not apply to losses on in
come-producing property, such as losses from Ponzi-type
investment schemes

Mike9241