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Dear Ed,
I am not an expert but do have practical experience on this subject as do many others on this forum.Maybe this will get the ball rolling:
1.There is an issue of Trader status vs. just trading.Trader status gives you more supposed options for deductions but from what I have heard also leaves you more open for audit re. dedicated computer, home office and areas the IRS dwells upon..sole source of income.
2.I have opted for simply handling my daily trades as an investor even though I made more trading commodities last year than practicing medicine.My systems have me always in the maket but are run mechanically whether day trading or position trading.
3.The tax on realized capital gains operates by a formula which works out to 28.8%.There is a tax on unrealized capital gains which I do not recall offhand.
4.I have also submitted for deduction the cost of mechanical trading systems I purchased as well as data suppliers.This is the same as I have done for years in deducting stock market advisory costs without a problem.
I have used the same accountant for 20 years and saw no problem making the transition to including another income stream with him.I am not suggesting you should not get a local expert,but due to various professional moves my accountant is 1300 miles from me.
Check out some CPA's in your area and I am sure you will come up with a solution barring some disastrous thing I have said here which I am sure will be noted.
Regards,
John
------------------ Reply Separator --------------------
Originally From: etccu9x@xxxxxxxx
Subject: taxes
Date: 05/09/98 05:48am
DEAR SIRS; I LIVE IN THE L.A CA. AREA. I TRADE EVERY DAY. THERE
ARE SPECIAL TAX FORMS AND RULES FOR TRADERS. I NEED THE NAME AND
ADDRESS OF A THIS KIND OF SPECIAL TAX PERSON OR COMPANY. CAN ANY ONE
IN THE GROUP RECOMMEND ONE. ED.
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