I traded all last year full time and I lost money. I am doing this full time and listed my profession as trader. I received a notice from the IRS today that I owe them $5000. The IRS sent me printouts from my Interactive Brokers account. Could somebody recommend a professional to help me straighten this out? Do I need to find a trading accountant?
IRS claims I owe $5000
- Thread starter jodistrict
- Start date
I put "trader" on the front of the 1040 form. This is been my only source of income and I have been doing it full time. But I didn't do that many trades because I was practicing. Do I have to convince them I am a day trader? Also, the notice they sent me was for 2012. So, I assume they would try to nail me for 2013 and 2014 also.
The IRS is frequently wrong about these things. I've gotten a few letters from them over the years that represent errors on their part. But they have always been for small amounts (less than $50). So I pay them, because involving my accountant costs more than that. But this is much more money. Do you have an accountant?
IMHO, it is not really a great idea to do your own taxes unless they are super simple. There are too many mistakes one can make. The books you buy in the bookstore to help you are just summaries, not the full tax code.
IMHO, it is not really a great idea to do your own taxes unless they are super simple. There are too many mistakes one can make. The books you buy in the bookstore to help you are just summaries, not the full tax code.
Actually, I think I spotted the problem. It has to do with the ETF "USO" which i traded. I don't think I filed the proper limited liability tax form. USO has to be filed differently because it is a limited liability company.
For example, the tax doc the IRS sent me says
Shown on return $0 Reported to IRS by other 3830 Difference 3830.
Does this have something to do with cost basis?
For example, the tax doc the IRS sent me says
Shown on return $0 Reported to IRS by other 3830 Difference 3830.
Does this have something to do with cost basis?
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yes, same thing happened to me. I called them up on the 800 number and read the cost basis right off my turbo tax printout. That took care of the problem.
Looks like cost basis..as for filling as a trader I suggest you to read more online. Just type trader status in google and read.
http://www.traderstatus.com/
Typing "trader" in 1040 is not the right way
I personally prefer unemployed.
you don't want any problems with your local tax collector, aren't you?
http://www.traderstatus.com/
Typing "trader" in 1040 is not the right way
I personally prefer unemployed.you don't want any problems with your local tax collector, aren't you?
I agree, the only thing trader status gets you is the ability to deduct your expensesLooks like cost basis..as for filling as a trader I suggest you to read more online. Just type trader status in google and read.
http://www.traderstatus.com/
Typing "trader" in 1040 is not the right way
you don't want any problems with your local tax collector, aren't you?
