WASHINGTON, DC—Representatives Jamie Raskin (MD-08) and Jim McGovern (MA-02) introduced the Tax Relief for Victims of Crimes, Scams, and Disasters Act, legislation to reinstate a tax deduction previously available to victims of scams, thefts, accidents and other personal casualty losses. After the 2017 Trump tax cuts repealed a critical tax deduction previously available to taxpayers suffering personal casualty losses, reporting has revealed a pattern of devastated Americans saddled with exorbitant tax liabilities after losing money through scams, frauds, thefts and similar adverse events.
“Our government should work as an instrument for the common good—protecting Americans against robbery, theft and on-line scams—not compounding victims’ hardship with you’re-on-your-own-jack tax laws,” said Rep. Raskin. “Instead, to this day, former president Donald Trump and MAGA Republicans’ policies are ripping off fraud victims while scammers rake in billions of dollars every year. Our government can act swiftly to relieve Americans reeling from personal casualty losses and the perverse harmful effects of the plutocratic Trump tax cuts and their sinister little tricks.”
Taxpayers with losses from scams, robberies, storms, fires and other adverse events are taxable under current law for those losses. Indeed, an elderly person who loses stock certificates in a scam ripoff not only has no deduction but must pay taxes on any income realized.
“You know how they say life isn’t fair?” Rep. Raskin said. “Trump and the Republican Party made that the law.”
“Congressman Raskin and I are working to get government back on the side of the people—and our new bill is going to help make sure that Americans who are ripped off aren’t further screwed over by their own government,” said Congressman McGovern. “While President Trump and Republicans made it easier for scammers and con artists—no surprises there—Democrats are making sure that America’s tax policies support everyday people by fighting for tax relief to those who are hit with absurd tax liabilities when they lose money through scams, fraud, or theft.”
Reps. Raskin and McGovern’s bill would bring relief to taxpayers experiencing hardships by reinstating the tax deduction for personal casualty losses that was available prior to the 2017 Tax Cuts and Jobs Act. Crucially, the bill would allow victims who suffered losses after passage of the 2017 bill to claim this deduction.