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

To: Robert A. Green, CPA who wrote (38)	2/16/1998 5:44:00 PM
From: Colin Cody	Respond to of 1383

Bob, Re: "Do you think America's billionaires work full-time at any one of their 100+ trade or businesses?" . No of course not. There is no rule for most trade or businesses on how much TIME they must have spent on them. OTHER than STOCK TRADER and REAL ESTATE and some others -- the TIME FACTOR is not important at all! . Don't get me wrong, I am NOT saying it is FAIR. I was only asking you about THE LAW, as it applies to Traders! . Re: "Many of us are employed at a job but we also have time to trade securities as a trade or business. A job takes 40+ hours per week Monday to Friday 9 to 5. We have mornings, nights, weekends, and Internet access at work. Many of us make security trades and conduct research during the day at our jobs." . I agree with you, and it is TOO BAD that as a result such a situation precludes one from sustaining TRADER STATUS. . Of course we both know the CODE does not mention what qualifies you to be a trader. That's why the COURTS get involved, and I was wondering how you got around the landmark decision of Laing v. Comr, which is THE de facto ruling on the TIME ELEMENT of Trader Status. . Clearly Laing states that Trader Status MUST be your PRIMARY occupation that provides MOST of your income. . Re: "For those naysayers about trader tax status, consider the following possibility. You are a trader (you trade daily and frequently, with the intention and goal of short-term price swings, etc.) and you report a long-term capital gain of $100,000. The IRS audits you and takes the position that you are a trader, not an investor and you are not entitled to the long-term capital gains rates. What do you do then?" . You puzzle me here! Were you JOKING?? (g) . For the people reading -- let's discuss: . Why would a Trader report a LONG-term capital gain? . Why and when would the IRS ever take the position you are NOT an Investor, but are a TRADER? . Let's say the IRS DOES in fact claim you are a TRADER. Please explain what on earth THAT has to do with not being entitled to LONG-TERM CAPITAL GAIN TREATMENT. . Like I say, let's discuss for education purposes, whether it was a joke or something else! (g) . Colin

To: Robert A. Green, CPA who wrote (38)	5/22/1998 5:59:00 PM
From: Monty Lenard	Read Replies (1) \| Respond to of 1383

"The IRS audits you and takes the position that you are a trader, not an investor and you are not entitled to the long-term capital gains rates. What do you do then?" A trader is considered to be in a trade or business that produces capital gains and losses rather than ordinary income and losses. The governing factor is whether the securities sold were capital assets in the hands of the taxpayer and the length of time the capital asset is held. Monty