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Oh for the good old days when you could spread you profits
over year end, and delay paying any taxes until you took
your profits as income. When stock traders started to use
the techniques to delay paying their taxes, the IRS closed
the door. Now, if you want to accomplish this, you must do
it off shore.
-----Original Message-----
From: BrewsPad@xxxxxxx [SMTP:BrewsPad@xxxxxxx]
Sent: Wednesday, February 11, 1998 12:24 PM
To: metastock-list@xxxxxxxxxxxxx
Subject: Re: Trading and taxes
Jerry wrote:
<< Short term trading generates income which is taxed at
ordinary income
rates.
When you factor in state taxes, the tax bite can be well
in excess of 40%.
With short term trading, if you are successful, you are
pretty much taxed on
an annual basis. If you are wrong, there are limits on
using the losses for
tax purposes.
Long term investors are accumulaters of wealth. The
maximum tax rate is 20%
(Federal) and this tax is not paid until the sale of the
asset. It has been
my experience that long term investors accumulate wealth
faster than traders.
Now there are exceptions to every rule and sometimes
trading wins. >>
All profits/losses from futures trading, whether day
trading or holding a
position for a year or longer, are taxed at 60% long term
capital gains, and
40% short term capital gains. (Refer tofederal tax form
6781.)
Jim
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