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To: FWS who wrote (41725)	4/12/2001 8:02:32 PM
From: William	Respond to of 54805

It goes on Form 4952. William

To: FWS who wrote (41725)	4/12/2001 8:12:29 PM
From: Mike Buckley	Read Replies (1) \| Respond to of 54805

FWS, You asked about deducting margin interest. According to the Fool's Investment Tax Guide, it is "deductible up to the amount of net investment income received and is reported on Schedule A using Form 4952 as a back-up computation. The definition of net investment income includes short-term gains, so short-term margin interest can generally be deducted against short-term gains." Regarding long-term capital gains, some important decisions need to me made that are explained in greater detail than is appropriate for me to quote here. If you took any long-term gains last year (no, I'm really not being snide), you've got an important decision to make. If I understand it correctly, it appears that you can include the long-term gains as investment net income, allowing you to deduct more margin interest. However, if you do so, you give up the preferential tax rate otherwise applied to long-term gains. Remember that I'm not a tax advisor. Unfortunately I am still fairly young and single It's not nice to brag. :) --Mike Buckley

To: FWS who wrote (41725)	4/13/2001 12:57:04 AM
From: Dr. Id	Respond to of 54805

I'd like to know if interest paid for buying stocks on margin qualifies as a standard deduction. ie: can i deduct the 10k I paid in margin interest? or do i have to stick with the standard $4400. thanks fws I believe that you can only deduct margin interest against other interest payments and dividend payments. I don't think that you can deduct it against short or long term capital gains. Dr.Id@Ilostmoneyonmargin...Askmehow.pov

To: FWS who wrote (41725)	4/13/2001 4:56:43 PM
From: Jacob Snyder	Respond to of 54805

re: tax question: Get Turbotax. It walks you through the numbers. You can: 1. deduct margin interest only up to the max of your dividend + interest income, or 2. move cap gains (LT or SH) into "regular income" catagory, up to the total of your margin expense. Turbotax will crunch the numbers, so you can compare the two choices (an exceedingly long and tedious process to do by hand). If you don't use all your margin interest this year, you can carry it over to next year.