How do I report the theft of my crypto investments. I invested with a company and they disappeared taking all my investment, $7K at the time. How do I report this loss?

[Rickbocek]

Well

in most cases, it is usually near to impossible to trace a crypto theft regardless of the method you were exploited with.

in recent years , the government have gradually deciphered a way around trailing identities of crypto scammers 

Hackers can be tracked down talk more mere crypto thieves with zero tech IQ

If you do a little more research you would have come across the Eyes Openers. Org, a non governmental organisation that has researched deeper than the government in crypto and any loss to theft  by any method on crypto assets can be recovered by them. 

[Rickbocek]

Well @rjs @LeonardS @sherry-kirkpatri 

in most cases, it is usually near to impossible to trace a crypto theft regardless of the method you were exploited with.

in recent years , the government have gradually deciphered a way around trailing identities of crypto scammers 

Hackers can be tracked down talk more mere crypto thieves with zero tech IQ

If you do a little more research you would have come across the Eyes Openers. Org, a non governmental organisation that has researched deeper than the government in crypto and any loss to theft  by any method on crypto assets can be recovered by them.

[wackywek]

Mike - Thanks for the explanation related to investments in crypto. Just to make sure I completely understand that what occurred to me isn't covered related to a tax deduction, I had the following issues:

1. My cell phone # was hacked, and I had to get a new phone#

• The hackers had several Pieces of my personal data Name, Address, Birthdate & Socail Security #.

2.  I had all of my user id's & passwords on a on-line password facility called 'RoboForm'.  This was also hacked

3.  My Microsoft Account Login was than hacked.

4.  With-in Microsoft there is (what I thought was secure), Microsoft's One Drive and there I had my user-id &         password for my Coinbase wallet

5.  The Coinbase Wallet was than hacked which contained approximately $40,000 combined Bitcoin & Ethereum valued coins.   

6.  I contacted Coinbase who addressed the issue but finally told me that my Coinbase wallet was 'my' responsibility related to securing the wallet so they were no longer responsible for the stolen coins, which had already been transacted via the 'Block Chain'

7.  I also have attempted to address with Microsoft tech support how the hackers were able to get my 'pin#' to get into my 'Personal Vault' where my Coinbase user-id & password were.

8. I have reported this to the FBI Fraud Division as well as TurboTax

• TT case# [phone number removed]
• Experian case# [removed]

 9.  So the question is: Do the above circumstances comprise a 'Ponzi Scheme' and I can legally deduct this loss?  

Again, I appreciate your consideration related to the above issue

Regards,

[removed]

[email address removed]

[rjs]

@wackywek 

The theft of your cryptocurrency is nothing at all like a Ponzi scheme. A Ponzi scheme is an investment fraud that pays existing investors with funds collected from new investors. Your theft loss was not due to a Ponzi scheme. There is nothing that you can deduct.

If you are concerned about security, don't post personal information like your real name, email address, case numbers, etc. in a public forum like this. Some of your personal information was removed by the forum software. You can remove other information by clicking the three dots in the top right corner, then selecting "Edit Reply."

[Missy20241955]

Hi Mike,

I see your response is from 2021.  Would it still be applicable for TY2024?   The information you provided is quite helpful to my situation is still applicable.  Thank you!

Missy

[IsabellaG]

For the most part, there is no deduction for lost or stolen crypto. Almost all casualty and theft losses aren't deductible from 2018-2015, unless the loss is caused by a federally declared disaster.

Mike9241 was explaining the rules concerning Ponzi-scheme losses, and are not handled in TurboTax. We would recommend consulting a tax professional who specializes in this area if this is your situation.