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New Member
posted Feb 5, 2025 9:19:39 AM

I was a victim of a debt consolidation program that is currently going through the courts. I lost $5000. Is this deductible

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2 Replies
Level 15
Feb 5, 2025 9:25:27 AM

no

Expert Alumni
Feb 5, 2025 9:26:11 AM

This type of loss is generally considered a loss from theft.  If this was a personal debt, it is not deductible on your federal tax return.  If this loss is related to a business, it may be deductible as a loss on your business return.  

Casualty and theft losses are only deductible when caused by a federally declared disaster.