Sunday, March 15th, 2015

How does stock trading affect taxes??

? Anyone has any good websites that detail the effects of stock trading in taxes? I am looking for specs? Cally whether you can use the money lost in the stock market as a tax write off.

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One Response to “How does stock trading affect taxes??”
  1. Spock (rhp) says:

    there are multiple questions that require answers

    was 2007 your first year trading? If so and you elect to be treated as a professional trader [file schedule C] then your net loss may be deductible against your other income.

    otherwise, your capital losses are deductible only to the extent of your capital gains plus $3,000. the excess carries forward to future years.

    ***
    the tests for and tax ramifications of being a professional trader are complex. try searching irs.gov for their guidance, then look at traderslibrary.com on the web for books on the subject.

    {Hint: if you also have wage income in sufficient quantity and duration that trading was obviously a part time activity, the IRS will try to deny you status as a professional trader.}

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