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

To: Trader J who wrote (504)	10/8/1998 9:12:00 PM
From: Colin Cody	Respond to of 1383

Am I correct when I say that the mark-to-market is just the marking of your holdings at year end and declaring it on your schedule D regardless of whether it is a gain or loss? . You have the general idea, but they wouldn't go on Sch D. As Kaye indicated there is little guidance in this area. If your tax advisor is experienced in Trader Status, then go with her advice on this. . You should read the S.I. threads to get caught up to speed. There you will see criteria for being a Trader and for making the Sec. 475 MTM election. There is no magic bullet here to save your 1998 losses from some deferral of recognition for tax purposes. . And while we approach FOR ALL: Last chance for the 1997 Sec 475 election is October 15th. ONE WEEK AWAY!!! . Colin

To: Trader J who wrote (504)	10/9/1998 7:57:00 AM
From: Kaye Thomas	Read Replies (1) \| Respond to of 1383

For now, the best information on how to file the section 475 election is that you attach a statement to the return for the year for which you are making the election. But as I said, the IRS is supposed to come out with guidance on this by the end of the year, and if they meet that goal (there's no guaranty they will) then you'll do whatever they say in that guidance. Colin points out that there's plenty of information on trader status and tax rules in this thread, but neglected to mention that there's also plenty of misinformation on that subject here, too. I'm sure Colin will be the first to agree with that! So: caveat lector. Meanwhile, bear in mind that the election is irrevocable and causes you to report all trading gains as ordinary income, not capital gain. Kaye Thomas, author Fairmark Press Tax Guide for Investors fairmark.com