PonziScams.com Schemes & Due Diligence

Ponzi Scheme: There is not much tax literature on Ponzi Schemes, probably because many people who lose their savings are too ashamed, embarrassed or afraid to report their victimization. In essence, a loss from a Ponzi Scheme is a theft loss; it is a casualty. An older, but still very powerful ruling, is FSA 1999-942, which is actually a 1993 field service advice. It contains excellent citations that you should review further. (The following are excerpts from an actual IRS document. To protect taxpayer privacy, all references to the company name and products manufactured have been changed using fictitious references.)
The facts of this case may be summarized as follows: X was a corporation. It represented itself to be in the business of selling product. In reality, X was an elaborate ponzi scheme which began operation as early as several years earlier. It is estimated that the operation defrauded many investors out of lots of money.
http://www.pac-c.org/tax%20relief.htm

Basically, if a Program Scammed you out of Money That is Theft, and you can use that as a tax break on your Taxes on your Schedule A 1040 Form! But don’t believe me Ask you Tax Professional About Losses to Scams, they are More than Willing to help out! You may have to provide additional documentation on the matter, but hey a TAX Break take it!