H&R Block just confirmed to me the new tax rule associated with Fraud losses. The IRS rule Rev Rule 2009-9, Rev Proc 2009-20 states that Mantria Investors can deduct 95% of their initial investment from their 2009 taxable income. If Mantria Investors recover any of our initial investments later on, we will report it as taxable income. The SEC case number and a copy of my Mantria Investment was all that was required for documentation.
H&R block used Form 4684 to process the loss.
Please check with your tax advisor to confirm the new rulings. With this IRS rule, I will recover at least some of my investment thru a reduction of my taxable income. This is some consolation, for now.
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Thanks to "Mantria Investors" for above info.
ReplyDeleteCan only after tax money be deducted? I imagine that self directed IRA money does not qualify since it is after tax money and was never taxed to start with except for the contributions.
"It's the losses that kill you!" by W.M.
(sorry, I couldn't resist a little sarcasm)
I do not think we can get any help from the IRS for our IRAs. Our best chance for our IRAs is to recover through the IRA company's "ommission and error" insurance. Refer to Dr Mary Phillips last email. In the meantime, I am looking into converting my IRA into a Roth IRA since the Mantria value is now "zero". If I recover anything in my IRA, it will have a significant tax advantage as an IRA.
ReplyDeleteI have also been informed from Dr Mary Phillips in her latest email that we may now recover up to 95% of our taxable account investments! I am right now coordinating my tax person with Dr Mary's.