Taxes and Trading with a GBP Denominated Account as a U.S. Citizen

[ZoneTrooper]

Ok, maybe this is an easy question that everyone know the answer to. But I just don't see a easy solution.

Tax wise, what are the consequences and paper hassles you have to deal with when trading when you choose to have your Forex Account based with something else besides the U.S. Dollar?

How do you report your capital gains/losses and interest?

It seems to me, that everytime you have a gain, you have to compute the gain in U.S. Dollars, and track it..... Please tell me that I am wrong.

 

[late apex]

While I don't have first-hand experience with a non-USD-based forex account, why do you believe it would be any different than a USD-based one? With the latter, you certainly don't need to track every transaction for tax purposes.

To quote from Green & Company:

Ending net assets (at market value) less beginning net assets (at market value), less additions of cash, plus withdrawals of cash, equals net performance. Subtract non-trading items such as interest income, add interest expense and other expenses and you have net trading gains or losses on cash forex.

All you'd need to do, in my view, would be to express each of the above line items in USD terms, and you're all set.