Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : IRS, Tax related strategies--Traders -- Ignore unavailable to you. Want to Upgrade?

To: Street Walker who wrote (29)	2/16/1998 2:45:00 PM
From: Box-By-The-Riviera™	Read Replies (2) \| Respond to of 1383

The basis for trader status has only been "finally" determined by tax court cases. There is no actual IRS ruling concrete enough to let you determine your risk pre-audit before you file. You risk having to defend yourself in an audit....and the variables are somewhat obvious, the knowledge of your auditor, how good your attorney or cpa are if they go in with you etc etc etc...... BTW: if you declare this status.....your losses are NOT relieved from the $3000 rule.... since you will still report gains/losses on Sched D..... however, if you choose to mark to market....then your income will become ordinary...and will be reported on Sched C.....relieving you of the $3000 loss rule....BUT....you will then pay self employment taxes.... Other expenses (without mark to market election) however can be deduced on Sched C....where prior only on Sched A....... this would be one real advantage of trader status for deducting trading related expenses like the ones you described....if you are prepared to defend yourself in an audit. Joel

To: Street Walker who wrote (29)	2/16/1998 4:27:00 PM
From: Colin Cody	Read Replies (2) \| Respond to of 1383

S.W. you have described a CLASSIC Trader Occupation. That means, assuming you DO qualify, that your buys and sells go on Sch D as short-term gains/losses and your ordinary & necessary expenses go on Schedule C, RATHER than going on Schedule A, line 22. Have you been using line22?? It may pay you to look into Trader Status. You need a bit more than you described in your note, IMO, but you seem to be one who qualifies from what you wrote! Colin BTW I also have had established a Kill Key account for a couple years now, but never put any $$ into it or used it. How do you like it? I thought Level II was sort-of "included" on the Kill Key screen? How long have you been using it? 400 trades is about one or two 1,000 share flips a day. Is that about what you are doing? Is it worthwhile over the long-haul? I'm not really looking on doing it full-time, I have a CPA practice that takes up my time (g)