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Strategies & Market Trends : Income Taxes and Record Keeping ( tax ) -- Ignore unavailable to you. Want to Upgrade?

To: bruce bell who wrote (1589)	12/11/1998 12:40:00 PM
From: Colin Cody	Read Replies (1) \| Respond to of 5810

My informal research indicates that approximately 2,400 Trader Status returns were filed for 1996. My informal research indicates that currently there are approximately 100,000 people "trading" on-line and/or in "trader rooms". some of these people are potentially, unwittingly in violation of various SEC & local State investment advisor/registered rep rules. the substantial majority of these 100,000 people are losing money. a small percentage are doing well, some are doing extremely well. That of these "100,000 traders" only 3,000 to maybe 5,000 are truly qualified to file as "trader status," leaving the remaining 95,000 people truly being "investors." "Investors" even if they may have hundreds of confirmations written over the course of a year. IMO, it can be dangerous to proceed with filing as a "Trader Status taxpayer" without an experienced tax advisor, for two reasons: #1 as stated above most people who "trade" are classified as "investors" and not as they think, as "traders". Being a trader for on-line purposes is not at all the same as being classified as a trader for tax purposes. #2 for those who ARE truly tax qualified traders, the rules are complex and "no one" knows them, especially those in the rank and file of the I.R.S. Therefore you NEED competent representation before filing as a trader. Colin