Is there a particular number of trades in stocks or similar securities required to qualify as a Trader, where expenses of the trading business are shown on Schedule C ?
Once I do qualify as a Trader, what expenses can be shown that otherwise would not be eligible?
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I'm not aware of any "number" of trades that would make put a person in the trade or business of securities for their own account. Here is a link to some guidelines:
https://www.irs.gov/taxtopics/tc429.html
It is a high bar to be considered in the trade or business of dealing in securities for your own behalf. Here is a case where the taxpayer was found NOT to be in the trade or business. Read it and compare to your own circumstances
An investor was not a trader in securities because his trading activities did not have the frequency, continuity, and regularity to constitute a trade or business and the long holding periods showed that he was not seeking to profit from the swings in the daily market. Endicott v. Comm'r, T.C. Memo. 2013-199 (8/28/13).
There is no "bright line test"...so be informed and beware that it is a high hurdle to be considered in the trade or business of securities trader for your own account.
I'm not aware of any "number" of trades that would make put a person in the trade or business of securities for their own account. Here is a link to some guidelines:
https://www.irs.gov/taxtopics/tc429.html
It is a high bar to be considered in the trade or business of dealing in securities for your own behalf. Here is a case where the taxpayer was found NOT to be in the trade or business. Read it and compare to your own circumstances
An investor was not a trader in securities because his trading activities did not have the frequency, continuity, and regularity to constitute a trade or business and the long holding periods showed that he was not seeking to profit from the swings in the daily market. Endicott v. Comm'r, T.C. Memo. 2013-199 (8/28/13).
There is no "bright line test"...so be informed and beware that it is a high hurdle to be considered in the trade or business of securities trader for your own account.
If someone is claiming active trader status, it helps to add foot notes to the return that explains that status is being claimed.
Does Turbo Tax have the ability to add free text / foot notes to the return.
I used a CPA earlier and he was able to put these foot notes earlier (using his professional tax prep software).
But not sure if Turbo tax can do so. I would like to do my own taxes with turbo tax so need to ensure I can add the foot notes for this status.
No ... you cannot add any kind of notes to the return when using a DIY program ... to attach them will require you to paper file the return.
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