Hi.
I have a couple of related questions:
1) Do we have to report income on Brokerage accounts only within US or any brokerage account outside the US?
2) Let's assume I started my account with $1000 and ended up with $1500 by the end of the year, which means I have to pay tax on $500 earned. What about next year? Should I take my base/initial money as $1500 and calculate my taxes on profit above $1500?
3) How sensitive is IRS towards details? I am sure we may miss certain small amounts when dealing with hundreds of trades within a year.
4) An off-side question: I remember opening an account with a couple of brokerage accounts, but have never traded with them, never deposited money into them. Do I have to report those accounts on yearly filings to IRS? What if it was just a demo account that I opened, does it count as an account that has to be reported to IRS?
Overall, it is so unclear and vague what we have to report, when it comes to such details as demo/live accounts, or traded/never traded issues. And we never keep records until we learn we had to. Anyway, I would be grateful if you could help.
Thank you!
