Trader Tax Status?

T

TradeUP1

Am new to this great site, and even newer to forums, so I hope you
will bear with me.

I have been day trading for years and never considered filing taxes
using Trader Status. This time, however, with all of the new
products, filing income taxes is making my head pop off and for
for first time I went for an extension. Now I am left with the prob.
of finding a competent person to finish what I started.

Question: Does anyone know if any CPA can do the job or does
it have to be someone who specializes in that section of the codes.
I talked with the people at Green Co. and that isn't for me,
so looking and hoping I can find a local.

Any ideas pointing me in the right direction will be greatly appreciated.
:confused:
 
First of all, you can NOT establish yourself as a "Mark to market" trader until April 2009, for tax year 2009, the cut off for 2008 Tax Year was April, 2008.

Make sure you use an accountant that is familiar with this tax status, he does not have to be Green, or any of these other special CPA's.

So file your 2007 return like you did in the past, and you have 11 months to elect MTM.

surdo
 
Quote from TradeUP1:

isn't for me,
so looking and hoping I can find a local.

Any ideas pointing me in the right direction will be greatly appreciated.
:confused:
More...

It isn't brain surgery, and a decent CPA should be able to handle it. But naturally, ask first.

Also the mark-to-market issue is not related to initially filing as a trader. It isn't necessary, but may be helpful next year if you want to pursue it.
 
http://www.hartmanncompany.com/

That is the web site for my CPA. He specializes in Trader Taxes...and has been doing mine for 5-6 years. I highly recommend him.

As another poster mentioned, you are too late to file for trader tax status for this year. You should definitely apply for next year if you qualify.
 
Although you have not apparently declared trader status to the IRS, I hope you are filing a Schedule C for trader-related expenses. These can be substantial and offset gains (or add to losses) – for computers and accessories, software, internet connection fees, telephone charges, margin loan interest, office supplies, bank fees, books and publications, and office rent or home office expenses (a proportionate share of mortgage interest, real estate taxes, utilities, repairs, maintenance, homeowners fees, etc.). Filing a Schedule C is better than Schedule A since you are not subject to the 2% of adjusted gross income limitation. Schedule C expenses can also offset other income, including your spouse’s employment income, if you file jointly. Schedule C losses (expenses) are not subject to the $3,000 annual loss limit on Schedule D net losses.
This is an IRS publication on Traders in Securities:
http://www.irs.gov/taxtopics/tc429.html
 
Quote from Surdo:

First of all, you can NOT establish yourself as a "Mark to market" trader until April 2009, for tax year 2009, the cut off for 2008 Tax Year was April, 2008.

Make sure you use an accountant that is familiar with this tax status, he does not have to be Green, or any of these other special CPA's.

So file your 2007 return like you did in the past, and you have 11 months to elect MTM.

surdo
More...

Sure you can, just add a declaration at the end of the tax return, if you haven't already done it a previous year that is. Its supposed to be done by april of the same year but it can be easily fought if they have a problem with it being done late, which they won't anyways (as long as you are a legitimate trader and its not just a 'hobby'.)

Each year they tell me I owe self employment taxes though, which I have to kindly send them a response pointing out that I don't because traders don't roll like that.
 
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