Hello all, my first post. I hope this is the appropriate forum...
I have a daytrader account as well as two manager-traded SmithBarney accounts. The daytrader account has maybe 10k trades/year, while the manager-traded accounts have just 100 trades/year. In the past, we have used HR Block, and they entered the net profits, proceeds from sales etc. of each pro-traded accounts on one line of Schedule D, rather than individually list the 100 trades. They used the rest of Schedule D to individually list the daytrader account trades, as shown:
http://r7s8t9.info/srv/SDexample2008.jpg
As the daytrader trade list is a huge file, we have started using Green and TradeLog software to generate a schedule D for the 10k daytraded account.
I am told by our new accountant that we need to combine a listing of each of the 100 SmithBarney managed account trades with the 10,000 daytrader account trades, in one schedule D, rather than the simple elegant way of the past.
My guess is this is to detect wash sales. But the managed account trading was done completely independently of the daytraded account. As a result, if the same security were traded in both accounts, this would be a pure coincidence, rather than something the wash sale rule was meant to address. Trades in the same stock in both the daytraded and SmithBarney managed accounts would be just as unrelated as between the daytraded account and a mutual fund, or an unrelated person's trades.
Was HR block correct, i.e. is it OK for the managed account to list the net proceeds and net gain/loss on a single Schedule D line? Or do i need to blend in TradeLog a list of all 100 trades done by the unrelated managed account, with my 10,000 daytrades account? This is a real pain, to get the SmithBarney trade data, upload to Green, and have them combine it with my completely unrelated trade data. This will cost another few hours of expensive accounting time. It also makes it harder to isolate the results of the two accounts.
Is the reason for this added complication to detect wash sales? Or what?
The IRS hasn't protested the one-line managed-account net proceeds, costs and gain/loss method in past years, although granted, that doesn't imply it's OK.
Thanks for any comments!
I have a daytrader account as well as two manager-traded SmithBarney accounts. The daytrader account has maybe 10k trades/year, while the manager-traded accounts have just 100 trades/year. In the past, we have used HR Block, and they entered the net profits, proceeds from sales etc. of each pro-traded accounts on one line of Schedule D, rather than individually list the 100 trades. They used the rest of Schedule D to individually list the daytrader account trades, as shown:
http://r7s8t9.info/srv/SDexample2008.jpg
As the daytrader trade list is a huge file, we have started using Green and TradeLog software to generate a schedule D for the 10k daytraded account.
I am told by our new accountant that we need to combine a listing of each of the 100 SmithBarney managed account trades with the 10,000 daytrader account trades, in one schedule D, rather than the simple elegant way of the past.
My guess is this is to detect wash sales. But the managed account trading was done completely independently of the daytraded account. As a result, if the same security were traded in both accounts, this would be a pure coincidence, rather than something the wash sale rule was meant to address. Trades in the same stock in both the daytraded and SmithBarney managed accounts would be just as unrelated as between the daytraded account and a mutual fund, or an unrelated person's trades.
Was HR block correct, i.e. is it OK for the managed account to list the net proceeds and net gain/loss on a single Schedule D line? Or do i need to blend in TradeLog a list of all 100 trades done by the unrelated managed account, with my 10,000 daytrades account? This is a real pain, to get the SmithBarney trade data, upload to Green, and have them combine it with my completely unrelated trade data. This will cost another few hours of expensive accounting time. It also makes it harder to isolate the results of the two accounts.
Is the reason for this added complication to detect wash sales? Or what?
The IRS hasn't protested the one-line managed-account net proceeds, costs and gain/loss method in past years, although granted, that doesn't imply it's OK.
Thanks for any comments!
