May 20, 2025
Contact: IAA VP of Communications & Marketing Janay Rickwalder
The Investment Adviser Association (IAA) strongly supports the Tax Relief for Victims of Crimes, Scams, and Disasters Act, a bipartisan, bicameral bill led by Senators Moody (R-FL) and Baldwin (D-WI), and Representatives Steube (R-FL) and Raskin (D-MD).
At a time when fraud against older Americans is reaching crisis levels—with over $3.4 billion in reported losses in 2023 alone—this legislation offers urgently needed relief. Increasingly, victims are left not only without their life savings but also saddled with tax liabilities for funds stolen from their retirement or taxable accounts.
While current tax law allows for a narrow Ponzi scheme deduction for victims of investment fraud, it excludes those who have suffered losses through other devastating forms of fraud—such as government or business impersonation scams, romance scams, and more. This creates a troubling disparity in how fraud victims are treated under the law.
The Tax Relief for Victims of Crimes, Scams, and Disasters Act would restore the federal casualty and theft loss deduction for all taxpayers, regardless of the type of fraud or theft experienced. It also reinstates the deduction for all casualty losses—not just those declared under federal disaster declarations—and offers retroactive relief back to 2018.
By leveling the playing field and providing a path to partial financial recovery, this legislation marks a critical step toward fairness for all victims of fraud and unexpected disasters.
We applaud the bill’s sponsors for their leadership and urge Congress to move swiftly to pass this important measure.
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