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It's getting close to time to deal with that annual bugaboo:
the taxman.
Having read through some posts from last year, my understanding is:
* There is a special tax classification called "trader."
* "Traders" get some nice benefits in filing -- e.g. I think
only traders can write off all expenses of trading such as
data feeds, software, etc?
* To qualify for "trader" status, you must derive basically 100%
of your income from trading activities. No part-time jobs
or other outside income sources.
* Even if you qualify for "trader" status, there are some
disadvantages to filing as a trader, and you might not want to.
(I don't understand why not.)
Does that sound correct so far?
Assuming I'm not going to try for trader status, how should I report
my taxes? Do I have to construct a trade-by-trade history of my
entire year? Or can I just use the beginning/ending balances of all
accounts, automatically figuring in commissions/fees? What about
expenses like software, data, etc? What are good legal writeoffs for
a non-"trader" trader? What forms should I use? Any other useful
info?
Thanks,
Gary
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