Phone scam

[Ronald Koyle]

I have a client that received phone calls about if you send this money we will send you lots more money. She sent money, lots of money. There were calls that a person is at the airport and can't clear customs so sent money. Finally she realized that she was being scammed. Question: Is it a theft or did she give up the money volitionally? If it is a theft she sent money at various times do you subtract $100 from each time she sent money? There is no police report at this time because she is so embarased.

[Brilliant]

Phone scam

I think this is a casualty loss, it is deductible in the year the casulty occurred or the theft is discovered, If it is uncertain whether he will reimburse all or part of the loss, do not deduct the amounts of the loss in question untill the tax year when it is reasonably certain the loss will not be reimbursed.

Casulalty loss must be reduce by $100 per event.

[taxea]

I have a client that received phone calls about if you send this money we will send you lots more money. She sent money, lots of money. There were calls that a person is at the airport and can't clear customs so sent money. Finally she realized that she was being scammed. Question: Is it a theft or did she give up the money volitionally? If it is a theft she sent money at various times do you subtract $100 from each time she sent money? There is no police report at this time because she is so embarased.

I would call it theft by fraud but she should report it to the proper authority

[ChEAr$]

I would call it theft by fraud but she should report it to the proper authority

Yep, formal reporting is required to help cinch the deduction. However, i'm wondering just how taxpayer would fair in case of IRS audit. How do you prove the loss to an examiner's satisfaction? What's to say that withdrawal from the bank and purchase of money order to help an assumed friend return from London after being robbed including passport was not otherwise?

A rocky road indeed.