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TurboTax does not support losses from fraudulent investment arrangements, including so-called Ponzi schemes. See the attached screenshot from the program.
Here is some information on how those types of losses are treated:
You are allowed to claim an Itemized Deduction for Theft Loss in Schedule A. Since you were the victim of a Ponzi Scheme this theft loss is not limited to the $100.00 floor or 10%-of-AGI limits and it can create a Net Operating Loss. You have two options:
Regardless of how you choose to report the loss, you must do so through Schedule A. Unfortunately TurboTax does not have the forms necessary to deduct a Theft Loss from a Fraudulent Investment Transaction. We recommend that you visit a local Tax Professional to handle your situation.
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