There are still many facts that must be ascertained regarding the nature of the losses for FTX account holders and the causes that led to those losses. However, this article will now explore some additional potential remedies for taking deductible tax losses at some time in the future.

However, to qualify for this type of loss, the account had to have been established with an expectation of profit, there should be a “theft” under applicable state law, and there has to be a reasonable determination of the amount of the loss after considering the expectations of a recovery amount. It is unclear whether the facts at FTX have risen to this level of being able to ascertain with reasonable accuracy what a recovery might be, if any. In addition, it is unclear whether there was an actual theft or embezzlement of the account holder’s property or whether unsound business practices related to their business activities, with the related party,caused the bankruptcy.