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The IRS treats losses from a ponzi scheme as theft losses.
To deduct theft losses, there is first a $500 deductible which applies. After deducting the first disallowed $500, you must further reduce your loss claim by 10% of your adjusted gross income. The balance of the losses may then be claimed as an itemized deduction on Schedule A of your tax return.
If your casualty or theft loss deduction causes your deductions for the year to be more than your income for the year, you may have a net operating loss (NOL). You can use an NOL to lower your tax in an earlier year, allowing you to get a refund for tax you already paid. Or, you can use it to lower your tax in a later year. You do not have to be in business to have an NOL from a casualty or theft loss.
Here is a link to the IRS publication 547 which discusses in more detail how to deduct a theft loss.
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