Income Taxes and Record Keeping ( tax ) Message Board

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Strategies & Market Trends : Income Taxes and Record Keeping ( tax )

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To: henry jakala who wrote (302)	12/25/1997 1:10:00 AM
From: Box-By-The-Riviera™	Read Replies (2) of 5810

If you elect trader status (which is hard to qualify) cap gains would be reported on schedule d....but you can deduct your investment expenses on sched c.... If you are eligible for trader status.....and then elect mark to market rules.... all of your cap gains will go on sched c, instead of d, and yes....you will have to pay self employment taxes....but in this case, another benefit would be....all cap gains become ordinary income (self-employment)... and wash sale rules no longer apply. Trader status is something you have to qualify for every tax year....it's not forever. but....if you elect mark to market rules, you must always mark to market for any year in the future that you are qualified under trader status..... you definitely should make sure you REALLLLLLLLLLLY do qualify...or you will be very sorry down the road if you get audited. also....mark to market rules have complicated implications... better get a GOOOOOD tax professional..... if you get involved in this..... this information, BTW, doesn't come cheap. Joel

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