Scammed By a Lover! Can They Get a Tax Break?

0:00Scammed out of retirement money. Late cut, 6758. It's been years since I've been scammed at my parent's retirement money. By someone whom I was dating in 2020, since I received the retirement money after my parent passed away, I owe taxes at the end of 2020. I was so embarrassed that this happened to me, and I heard bad things about the IRS. I didn't want my paycheck to get garnished or anything. So I ended up sending up an installment agreement. I've been paying the IRS for five years. Now that I'm almost unpaying it and healed from being scammed, I want to know if I can get my money back and installment agreement that I was paying since theft was involved. There's a cuteness and naivety to this question. I'm sorry to say, no, you can't get all the money. You paid back in the installment agreement simply because theft was involved. As a matter of fact, between the years 18 and 25, of which 2020 is obviously a part in that range, theft losses are only deductible if there's a profit motive

1:05involved, okay. So it sounds like you were scammed by somebody who you were dating. I'm gonna take this as, this was kind of maybe a personal thing. I don't know. You know, maybe you spent a lot of money on them and now you're no longer together and you feel like they took all that money from you. Or maybe they asked for money from you just for, man, I really need money to pay for this or that or the other thing. And you kept supporting them and giving them money and they said, I'd pay it back. They never paid it back. So that's difference, right? And in fact, even if it's a thief in the night who came into your house and stole this money, it still wouldn't be deductible because there's no profit motive there. Now, I will say if you were scammed because this person who you were dating

2:05said, hey, I'm gonna take this money for you and I'm gonna invest it. Here's my investment fund, invest the money and then they ran away with it, right? They basically stole it. It's not that they lost the money in a bad investment. I mean, there would be tax repercussions there or be a different kind of loss. But let's say they ran away with it. Okay, that might be a theft loss, right? That's deductible because there's a profit motive. You didn't give them the money based on love and affection. You gave them money because they said, hey, I can make you more money off this money. Okay, so kind of got to know what's happening here. But apart from that specific situation, no, you're not gonna be able to get this money back from the insomnia agreement you were paying since theft was involved. I would maybe look at penalty abatement either based on the facts and circumstances for the tax year 2020 or based on first time abatement, right? You could call the IRS and maybe ask about that.

3:06You know, and then they should refund you right out of the money you've paid in, you know, whatever penalty is that you've paid in after you've since you're done with the insomnia agreement or you're almost unpaying it. You know, so that's kind of maybe a little bit of silver lining here. But yeah, those are two things at a high level. I would look at it as a tax professional in this case. Okay, tell me more about this. How did you get scanned by this person you were dating? Was there a profit motive? Hmm, okay, maybe we can then, you know, maybe the IRS just, you know, they don't have to accept it, right? A minute returns are kind of an extension of grace by the IRS, you know, but maybe we can look at amending that 2020 return, which, especially this late, the IRS may or may not accept, right? And, you know, when we're remaining returns that far back, you know, we really want to, we typically write a little letter or something to hopefully, you know, convince some of the IRS,

4:07say can we go back to this year, even though it's fairly old? And I'm also only saying that because you have been making payments on this year for the past couple of years. Right? If you hadn't, right, and you're just seeking a refund for the 2020 tax year, forget about it. You pass a three year refund statute limitations, right? But because you have paid money recently and specifically within the past two years with respect to this tax year, we may even try and amend a return, you know, on the basis that there was profit motive here, this should have been properly claimed as a theft loss, okay? What else? And then, but if that's kind of a no-go, I'd probably look at penalty payment, you know, and maybe get some of your money back from the insomnia agreement that way. But, you know, they're not going to be able to, you know, refund it just because, hey, this was, I was scanned by my boyfriend or my girlfriend. They're, it has to go a little bit deeper than that. Folks, if you, the IRS, you're a state of least $10,000 back tax,

5:08you don't know what to do, you don't know how to pay it. You qualify for a free consultation with us here, a choice tax will give us a call at $8668,000 tax. That's $8668,000, $829, or you can go to choicetaxelief.com, fill the form of the website, and we will reach out to you. Thanks so much for watching, everybody. See you in the next video. Bye-bye.