Hi Mike and thanks for your response. All my words are about Mark-to Mark Day Trader. I want to start day trading 1/1/2024 as individual. On the top of the 3115 asks: Tax year of change begins, for me it is 1/1/2024 but I am not sure if I want to be as day trader for 2025, 2026 so what would be for Tax year of change ends??
You said:
If you can't file by 4/15/2024, the election and 3115 can be included with a timely filed extension.
tax year of change ends 12/31/2024. I confused about 12/31/2024, extension due date is usually around Oct 16 not the end of the year. Let me know, If I want to take extension, form 3115 should file on Oct or when I apply for extension on April 15?
- What another document should be attached for duplicate when I mail it? Should I attach 1040 all papers along 3115 when I mail it to different address? what is the statement I heard it about that comes with 3115? Please notify me!
- Should I get an approval from the IRS? How can I get it?
- Do I sign 3115 when I e-file it that apparently should be attached to my 1040 tax return 2023 as a pdf? Right?
4. On Part ll line 7a, my answer is Yes and for 7b my answer is Not under exam ! Am I right?
5. What is the answer of line 25 section IV 481(a) ? Yes or No . Since I do not know about Cut-off basis if it includes for a Day Trader?
6. If I enter Yes, it does not ask me the amount of line 26 but when I enter No, ask me the amount!!!
If I will start 1/1/2024 as Day trader what would be answers above question?
As you mentioned: the 481(a) adjustment is the difference between the market value of your trading securities on 12/31/2023 vs their tax basis. What does it mean if I want to be a day trader as of 1/1/2024!!
A year-end broker's statement probably has both so you can attach it as support. be wary. review it. If you trade publicly traded partnerships, your broker's statement probably won't have your tax basis. for those you may need the k-1. also, some dividends you received in 2023 might be a return of capital that reduces your tax basis in the security and likely won't be reflected on the December statement.
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a negative 481(a) loss must be taken into account in doing your 2024 return a positive 481(a) must be spread over 4 years unless $50K or less see part IV question 28 . I need your help to better understand it.
For me who wants to start 1/1/2024, does it matter my assets value at the 12/31/2023? May I have an example please by any numbers.
How about expenses? Should I file Sch C and just enter expenses and your net income will be a negative amount?
would be greatly appreciated it!
