Filing for Trader Tax Status

10 Nov

“In this world there is nothing that is certain except death and taxes” -Benjamin Franklin

Green Trader Tax

If you trade full time and even part-time you may be eligible for “trader tax status.” Trade tax status is especially important in you trade equities. The biggest advantage to claiming “trader tax status,” is the ability to elect Mark to Market accounting. MTM accounting allows the trader to treat capital gains and losses as ordinary gains and losses. Filing under “trader tax status” also allows the deducting of our trading business expenses on a Schedule C.

The Tax Guide for Traders

I highly recommend the book The Tax Guide for Traders by Robert Green for anyone who thinks their trading falls under “trader tax status” or who has been trading professionally for some time. Green is the expert when it comes to trader tax laws and there are many tax advantages to your past filings by electing “trading tax status” on this year’s return. Green’s website Green Trader Tax has a wealth of information as well.

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