i am having a heck of a time figuring out the language in form 4684 and looking for help.”----> As the victim of financial fraud, Ponzie Scheme in 2008, you may be able to deduct some of your losses against your income. The IRS will let you deduct your losses from Ponzi scheme ripoffs. No word on whether losses due to the wire, the pigeon drop, advance payment or three card monte are allowable. The IRS has announced it will allow favorable ordinary loss treatment for investment theft losses. After Madoff scandal of late 2008, the IRS developed specific procedures to streamline and simplify procedures for deducting losses due to Ponzi-type schemes and other forms of investment fraud. You can figure your loss in Section B of IRS Form 4684. You deduct fraud losses in the same manner as theft losses.You need to fill out Appendix A of Internal Revenue Bulletin 2009-14, which you can download from the link in Resources, and write "Revenue Procedure 2009-20" across the top of IRS Form 4684.You need to return Form 4684, along with any supporting documentation with your tax return to the IRS.
Please visit the IRS Website here:Ponzi Scheme Questions and Answers