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Category: Tax
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Experience:  over 40 years experience in tax matters
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HI there Good morning I was scammed of my IRA in the amount

Customer Question

HI there Good morning
I was scammed of my IRA in the amount of 150K o I heve to pay the full federal tax as a withdrawal? This happened this past July 2010
Thank you!!!
Submitted: 6 years ago.
Category: Tax
Expert:  CGCPA replied 6 years ago.
Chat Conversation Started
Charles Greiner :

I am sorry to hear about your loss. It is a shame that these things happen. If you can show that you were scammed you have a choice. If this was a traditional IRA you will need to pick up the income and offset it with a loss for the scam. This loss can be offset directly on page 1 of the form 1040 but will need to have an attachment explaining what happened and why you are treating it this way.You should also attach a copy of your proof to the return. If it was a Roth IRA, the money was taxed before it went into the IRA and would be treated as a theft or casualty loss on Schedule A.Either way please be sure to send in the attachments with the return. The return should be mailed in NOT efiled since not all attachments show with efiled returns and since the return may be pulled for desk review. With the attachments and supporting documents the reviewer can see what you are doing.

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JACUSTOMER-ovgcew8c- :

Sir If you notice in this letter ,all the ending words are cut off ,Is there anyway you can redo it so I can understand better, Thank you !!!!!

Charles Greiner :

Unfortunately, no matter which way I redo this I will not be able to get it sized for you. If you are trying to print it, it may be the manner in which you are telling the computer to print. Try telling the computer to print the box with the answer rather than the whole screen. You may also ask your computer to run in compatability mode. To do this click on the up and down green arrows to the right of the website address box near the top of your computer screen. I am not a computer expert so I will not be able to help much more. than this.

Expert:  jgordosea replied 6 years ago.

There is no provision that allows "This loss can be offset directly on page 1 of the form 1040".
The law and regulations require that the loss be reported as a casualty loss on Schedule A and not as a reduction in the income received for tax purposes on page 1 of the Form 1040.


Expert:  CGCPA replied 6 years ago.
Mr. Gordos and I appear to be at odds on answering your concerns. Please be patient for a couple days while we resolve this.

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