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Per IRS Instructions for Form 4684 Casualties and Thefts, on page 6:

Losses From Ponzi-Type Investment Schemes

The IRS has issued the following guidance to assist taxpayers who are victims of losses from Ponzi-type investment schemes.

  • Revenue Ruling 2009-9, 2009-14 I.R.B. 735 (available at IRS.gov/IRB/2009-14_IRB#RR-2009-9).
  • Revenue Procedure 2009-20, 2009-14 I.R.B. 749 (available at IRS.gov/IRB/2009-14_IRB#RP-2009-20).
  • Revenue Procedure 2011-58, 2011-50 I.R.B. 849 (available at IRS.gov/IRB/2011-50_IRB#RP-2011-58).

If you qualify to use Revenue Procedure 2009-20, as modified by Revenue Procedure 2011-58, and choose to follow the procedures in the guidance, first fill out Section C to determine the amount to enter on Section B, line 28. Skip lines 19 to 27. Section C of Form 4684 replaces Appendix A in Revenue Procedure 2009-20. You don't need to complete Appendix A.

For more information, see the instructions for Section C, later, and the above revenue ruling and revenue procedures.

If you choose not to use the procedures in Revenue Procedure 2009-20, you may claim your theft loss by filling out Section B, lines 19 to 39, as appropriate.

To enter these losses in TaxAct®:

  1. From within your TaxAct return (Online or Desktop), click Federal. On smaller devices, click in the upper left-hand corner, then click Federal.
  2. Click Itemized or Standard Deductions in the Federal Quick Q&A Topics menu to expand, then click Safe harbor treatment from a Ponzi scheme.
  3. Click + Add Form 4684 Section B to create a new copy of the form or click Edit to review a form already created.
  4. Continue with the interview process to enter all of the appropriate information.

Note that any link in the information above is updated each year automatically and will take you to the most recent version of the document at the time it is accessed.


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