Retail Forex traders fall under Section 988, which covers
short-term foreign exchange contracts like spot Forex trades. Section
988 taxes Forex gains and losses like ordinary income.
In TurboTax, you enter Forex gains and losses as Other Reportable Income. A loss is entered as a negative number. Describe it as Forex loss (Section 988).
In TurboTax, open
your return and follow these steps:
- Click on Federal
Taxes, then on Wages and
Income
- Under All Income, locate the Less Common
Income section
- Click Show more and click Start next to Miscellaneous
Income at the
bottom
- On the next page, click Start next to Other
Reportable Income
(see attached screenshot).
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