Claim counterfeit money as a loss on Income Taxes |
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DMA
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Claim counterfeit money as a loss on Income Taxes |
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I just had an experience in which I was paying a bill in person in cash and 2 of the 100 dollar bills were counterfeit. I called the police and the officer took them. I am told that I am just plain out the $200.00. So now I am researching what happens when a person gets stuck with counterfeit money. One of the things I read was that I can claim this on my income taxes as a loss: This from an article from the Los Angeles Times titled "Who Foots The Bill For Counterfeit Cash" by CARLA LAZZARESCHI:" If the counterfeit money is given to you as part of your payment of wages, and then confiscated and not replaced, you should be sure to deduct the confiscated amount on on line 21 (other income) of the 1040 tax form. (If you do deduct your losses, be sure to get verification for your records; you wouldn't want to face a hassle from the Internal Revenue Service on top of all this.)" But I would have to "verify" this loss. My Question How do I verify this for Income Tax purposes? I do not know where and when my husband received this cash as he cashes his paychecks in one of two places - the credit union and a local bank which has closed. Even if we knew, we would not be beleived and could not have it replaced. Thanks!
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Fri Sep 20, 2013 3:56 pm |
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clydewolf
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Re: Claim counterfeit money as a loss on Income Taxes |
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quote: Originally posted by DMA I just had an experience in which I was paying a bill in person in cash and 2 of the 100 dollar bills were counterfeit. I called the police and the officer took them. I am told that I am just plain out the $200.00. So now I am researching what happens when a person gets stuck with counterfeit money. One of the things I read was that I can claim this on my income taxes as a loss: This from an article from the Los Angeles Times titled "Who Foots The Bill For Counterfeit Cash" by CARLA LAZZARESCHI:" If the counterfeit money is given to you as part of your payment of wages, and then confiscated and not replaced, you should be sure to deduct the confiscated amount on on line 21 (other income) of the 1040 tax form. Thanks!
No, that is not correct.
You are out the $200. You can not deduct the counterfeit money as a loss on your tax return. It is the same as if you had a hole in your pocket and the money fell through the hole, no deduction.
When your employer pays you in cash, you should check the money for couterfeit bills before leaving the office. When you find counterfeit bills, ask for "real" bills.
When you get cash at your bank or CU, ask the teller to do their scan for counterfeit bills.
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Fri Sep 20, 2013 8:54 pm |
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DMA
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Thanks so much for both of your helps. Husband doesn't use/ believe in debit cards or anything "electronic". Saves his cash and pays the bills with it. Don't owe nobody nothin'. Never got 100's back as "change" from a merchant, and no one gives us that much money. I'm 99.9% sure it was the local bank which closed. The store manager where I was trying to pay my bill said that banks do indeed give out counterfeit so they do not have to take the loss. Too much greed in the world I guess. Well the buck stops here has always been a motto for me. Thanks again.
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Mon Sep 23, 2013 2:22 am |
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JessicaL
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the post have some really good information.thanks
guest survey
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Mon Dec 11, 2017 3:11 pm |
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Inez
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I get paid cash a lot. I need to look out |
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This thread has really opened up my eyes to be careful with collecting payments. I clean houses for a living with my business here and don't pay much attention to the actual cash I collect. I collect from multiple customers so even if I found fake bills I wouldn't know who gave them to me.
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Thu Jan 04, 2018 2:39 am |
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