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Gold/Mining/Energy : Day trading in Canada -- Ignore unavailable to you. Want to Upgrade?

To: the Chief who wrote (1125)	11/8/1998 2:40:00 PM
From: keith massey	Read Replies (1) \| Respond to of 4467

Cheif One thing to add. The way I understand it is that 75% of your capital gains are taxed and the other 25% are free if you are not a professional trader. For example - you make $40,000 from daytrading. If you don't call yourself a professional your taxable income is $30,000 (40,000*.75) and you are taxed at 17%. You end up paying $5100 not taking into account other normal write-offs. If you call yourself a professional trader. You can right off a computer ($3000) your data service ($2000) and newsletters and magazines ($1000). For a grand write off of $6000 (I am being somewhat generous with with these numbers). Your taxable income is now $40,000-$6000=$33,000. You are now at a higher tax rate and pay 26% on $33,000 income which is $8580 not taking into account other normal write-offs. As you can see when you call yourself a professional trader you are paying $3580 more in taxes even when your got to write everything off. If you have a ton of write offs then it could work to your advantage but you would need to be spending more than 25% of your daytrading income which is probably to much anyways. I hope everyone is making more than $40000/year daytrading but I used these numbers because I knew the tax rates for them. Be very careful when you decide to call yourself a professional. The title could cost you. Best Regards KEITH