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Strategies & Market Trends : The Covered Calls for Dummies Thread -- Ignore unavailable to you. Want to Upgrade?

To: LemurHouse who wrote (3184)	12/21/2001 11:30:38 AM
From: Dominick	Respond to of 5205

You raise an interesting point. My counter to that argument is, there is form 1040 income of wages and other income and expenses and there is schedule C income. Accurate documentation separating the two should be sufficient, whether it raises a red flag or not. Another way around that argument would be to open a SEP IRA or 401K. Even though it's still taxed as ordinary income it would grow tax deferred. dom@notataxexpert.com

To: LemurHouse who wrote (3184)	12/21/2001 4:45:58 PM
From: Dan Duchardt	Read Replies (1) \| Respond to of 5205

Andrew, Moreover, it is irritating that the IRS considers you to be either one or the other; one cannot be both. As I understand it, if you elect trader status, then all investing gains/losses are treated as shortterm trading activity. That is, even long term capital gains/losses resulting from "investment" activity are taxed as short term. Based on what I have read, this is not true. In fact, it is possible to be a trader without electing mark-to-market accounting that forces you to treat gains as short term. Traders can have investment accounts just like everyone else, even if they do elect mark-to-market (which must be done by April of the tax year; you can't do it at tax time). It is important to distinguish between investments and trading, so it is best to keep the accounts separate. fairmark.com Kaye Thomas used to post on SI, but I've not seen him lately. traderstatus.com Colin Cody still participates on SI and has answered many questions about this issue. If you ask about this he will refer you to the link above, unless you cannot find your answers there. Member 1915633 Dan