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Without question, you can always deduct such expenses as itemized expenses
although you lose some of the value of the deduction depending on your
income level.
However, my interpretation of the law is that even though you have not
elected "trader status" you may still be in the "business of investing" if
that is your prime source of income (you do it on a full time basis,etc.)
and therefore may deduct these expenses as legitimate business expenses on
Schedule C of your tax return, which provides a full deduction before
adjusted gross income.
Keep in mind that the IRS determination of whether or not you are in the
"business of investing" is not a black and white issue and how they would
decide in a particular case would depend on all the facts and circumstances.
----- Original Message -----
From: "Thomas Alexander" <alexander_enterprises@xxxxxxxxx>
To: "Roger L. Shepherd" <mailrs@xxxxxxxxxx>; "Omega-list"
<Omega-list@xxxxxxxxxx>
Sent: Monday, July 23, 2001 11:02 AM
Subject: Re: Tax status
> But if you don't elect trader status, doesn't that mean you
> can't deduct expenses, such as data providers, confrences,
> educational books, computer upgrades etc?
>
> ta
>
> "Roger L. Shepherd" wrote:
>
> I exclusively trade futures on a short term basis.Trading
> futures, you are marked to market at year end for tax
> purposesregardless of whether or not you elect "trader
> status".The biggest advantage of not making the trader
> status election is that 40%of my gains are treated as
> long-term capital gains.
>
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