Scams Tax Relief Act

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 10891 Introduced in House (IH)]

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119th CONGRESS
  2d Session
                               H. R. 10891

To amend the Internal Revenue Code of 1986 to remove the limitation on 
        deductions for theft losses involving fraud, deceit, or 
   misrepresentation and to allow such deductions without regard to 
            whether the taxpayer itemizes other deductions.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                            October 22, 2026

 Mr. Morelle introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL

 
To amend the Internal Revenue Code of 1986 to remove the limitation on 
        deductions for theft losses involving fraud, deceit, or 
   misrepresentation and to allow such deductions without regard to 
            whether the taxpayer itemizes other deductions.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Scams Tax Relief Act''.

SEC. 2. REMOVAL OF LIMITATION ON DEDUCTIONS FOR CERTAIN THEFT LOSSES; 
              DEDUCTIONS FOR CERTAIN THEFT LOSSES ALLOWED WITHOUT 
              REGARD TO WHETHER TAXPAYER ITEMIZES OTHER DEDUCTIONS.

    (a) Removal of Limitation on Deductions for Certain Theft Losses.--
Section 165(h)(5) of the Internal Revenue Code of 1986 is amended--
            (1) in subparagraph (A), by striking ``a Federally declared 
        disaster'' and all that follows, and inserting ``a Federally 
        declared disaster (as defined in subsection (i)(5)), a State 
        declared disaster, or theft involving fraud, deceit, or 
        misrepresentation (as defined by the Secretary).'', and
            (2) in subparagraph (B)--
                    (A) in clause (i), by striking ``a Federally 
                declared disaster (as so defined) or a State declared 
                disaster'' and inserting ``a Federally declared 
                disaster (as so defined), a State declared disaster, or 
                theft involving fraud, deceit, or misrepresentation (as 
                defined by the Secretary)'', and
                    (B) in clause (ii), by inserting ``or theft'' after 
                ``disaster''.
    (b) Deductions for Certain Theft Losses Allowed Without Regard to 
Whether Taxpayer Itemizes Other Deductions.--Subsection (a) of section 
62 of such Code is amended by inserting after paragraph (21) the 
following new paragraph:
            ``(22) Theft losses involving fraud, deceit, or 
        misrepresentation.--The deduction allowed by section 165 for 
        losses arising from theft involving fraud, deceit, or 
        misrepresentation (as defined by the Secretary).''.
    (c) Effective Date.--The amendments made by this section shall 
apply to losses sustained after the date of the enactment of this Act.
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