Hi all. I read various questions and answers related to Stock trading and investment expense. I'm still a little unsure of the right answer.
I did a little stock trading in 2020 and made some short-term capital gains. I bought a computer that I use 95% for stock trading and plan to continue trading in 2021. I am doing it part-time, on the side (so I'm not a full day-trader for IRS Active Trader tax status). I've read posts that say I can offset the cost of my computer I bought against the capital gains I made (which makes sense to me) -- however, when I go in to TurboTax (in "Other Investment Expenses") to enter the expense, TurboTax tells me these expenses won't affect my Federal return - that I basically can't claim the expense (I live in Texas so I don't have a state return). Am I entering this expense in the wrong section or is it true - I'm not able to claim these expenses for my Federal return?
Alternatively - if I start a single-member entity (like an LLC) that I define as a Stock Trading business - can I then deduct the expenses to offset the tax burden on capital gains from my part-time stock trading?
Thank you.
