Victims of investment fraud have a tax recovery option under IRC Section 165(c)(2) which is an often overlooked provision from the IRS.
In most instances, capital loss deductions for amounts that exceed capital gains are limited to $3,000 per year.
The filing of a theft loss tax deduction can accelerate the recognition of your investment fraud losses and deduct the entire loss in the year of discovery.
Essentially, the unused portion of loss deduction is applied against income earned for the prior three years which can result in a refund of taxes paid in those years. If any unused loss deduction still exists, it can be carried forward twenty years as a deduction against future income.
The recovery of taxes paid to the IRS over the prior three years, through a theft loss deduction under IRC Section 165(c)(2) requires the coordinated effort of experienced tax and legal professionals. Fresh Start Tax professionals will analyze the following factors to determine the feasibility of a theft loss tax deduction under IRC Section 165(c)(2):
Upon acceptance of your tax matter, Fresh Start Tax will amend your tax returns for the prior three years and accelerate the recognition of your theft loss tax deduction under IRC Section 165(c)(2).
Fresh Start Tax investigates on behalf of victims of investment fraud, the feasibility of filing a theft loss tax deduction under IRC Section 165. Recent fraud cases which might qualify for theft loss deductions include:
Questions on 165 Theft Loss Deduction – Feel free to email us a question!
If IRS filed a substitute tax return for you, we can help!