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Subject:
Re: Trader tax laws...what are they?
Date:
Wed, 18 Mar 1998 21:49:01
From:
sptradr@xxxxxxxxx
To:
omega-list@xxxxxxxxxx
BAC wrote:
>I don't think you can have it both ways. If you file a Schedule C for a
>business, then the profits from that business also go on Schedule C.
>Therefore, you are subject to Self Employment Tax.
WRONG...read on
...
4. All trading related income (defined transactions in Section 1221)
reported on the 1099B is entered on Form 6781 (60% long term / 40% short
term split) first and then on Schedule D.
this entire post is consistent with my past experience with IRS,
however, i do not understand this "#4" item... surely IRS would not
tolerate an allocation, but would rather require specific designation of
LT, ST activity....hope someone can clarify
it appears to me that the IRS (beyond the local district director/local
auditor) is more interested in time involved in the activity, risk
involved, and purpose of the trading activity to define the contrast
with an investor.
preston in dallas
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