Washington ? The Internal Revenue Service issued guidelines Tuesday that will allow tax relief and refunds for some Bernard Madoff victims who were levied for investment earnings that turned out to be nonexistent.

IRS Commissioner Douglas Shulman told Congress the new guidelines are for taxpayers who have suffered losses from Ponzi investment schemes such as the massive Madoff swindle.

He said the guidelines will apply to victims of all Ponzi schemes — financial scams in which early investors are paid returns from money put in by later investors. But given the scope of the Madoff scandal, the IRS wanted to establish an easy system for investors to recover taxes they paid on “fictitious income,” Shulman said.

Madoff investors should have reported earnings from their investments with him through the years — the scheme stretched from the early 1990s to Madoff’s arrest on Dec. 11 — and thus paid taxes on those earnings. Given that some of those were “phantom” profits, investors have said they should be entitled to refunds of the taxes they paid.