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Technology Stocks : COMS & the Ghost of USRX w/ other STUFF -- Ignore unavailable to you. Want to Upgrade?

To: David Lawrence who wrote (10645)	12/13/1997 4:51:00 PM
From: Wigglesworth	Respond to of 22053

<<they may be fully dedictible>> Yeah, everything is dedictible if you send your tax returns to the EYE ARE ASS. :-)

To: David Lawrence who wrote (10645)	12/14/1997 3:46:00 AM
From: Dwight E. Karlsen	Read Replies (2) \| Respond to of 22053

David, what you say is true only if the business is a corporation or partnership, and the business is the one doing the investing, which would include reporting the income. Self employed people who are sole proprietors (not incorporated or a partnership), file a Sched. C (Profit and Loss) for each business activity. Personal investment activity is unearned income (in IRS-speak anyway) and is reported on Sched. D (Capital Gains & Losses), and investment expenses go on Sched. A, where they are subject to the 2% threshold. So if a person is investing for their personal account, it would not be proper to run investment expenses through a separate business enterprise; therefore they would not be "fully deductible", at least in the legal sense. However, if someone is making a living off active, full-time investing as their primary income generating activity (and I think many people are), then the IRS could probably deem that to be earned income. In that case, the income and expenses would be (assuming sole proprietor, ie not incorporated or a partnership) reported on Sched. C and Sched SE (Self Employment tax). So in this case the investment expenses would certainly not be subject to the 2% threshold, but then the income would be ordinary earned income, subject to regular income tax rates AND Social Security/Medicare on Sched SE. DK