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Your grannie may qualify to deduct the amounts she lost to con artists as a casualty/theft loss on Schedule A. She has to claim the losses in the year that she "discovered" that she had been conned. If she has already filed the tax return for that year, it may be worthwhile to amend it. Amended returns must be filed within three years in order to claim a refund.

In many of these cases where the elderly lose all their life savings to con artists, the casualty loss results in a "net operating loss", which can be carried back three years to recapture prior taxes and then forward for fifteen years and used against income taxes in future years. If her losses were great enough, your grannie may never have to pay taxes again.

Tell her to get with the program, bring her money back to the USA, claim her tax benefits, and NEVER, NEVER, NEVER give anyone she doesn't know any of her money again. If she doesn't follow your advice, it may be time to think about getting a conservator for her financial affairs.

You would be amazed how many of the elderly are being conned these days. Scamming the elderly is the biggest industry in our country.

Good luck!

Tax Attorney
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