"You must seek to profit from daily market movements in the prices of securities and not from dividends, interest, or capital appreciation;
Your activity must be substantial; and
You must carry on the activity with continuity and regularity.
The following facts and circumstances should be considered in determining if your activity is a securities trading business:
Typical holding periods for securities bought and sold;
The frequency and dollar amount of your trades during the year;
The extent to which you pursue the activity to produce income for a livelihood; and
The amount of time you devote to the activity."
Check, I think I qualify if not more then the issue for me is the whole "you needed to elect on last years tax return for this year's tax return" thing. I started back at the beginning of June, started a Fintwit account, subscribed to a stock news service, joined multiple discords, opened and funded my brokerage Cash Account and devoted time to study. I seemed a natural or either very lucky because in less then 2 months I earned an overall of 12K on a 25k account bringing it to a total of 37k and some change. I only make 3k a month at my current employment and I probably spent more then 40 hours a week devoted to trading and more if you count studying.
However, its not like I did not make any mistakes, some of my trades and scalps were bad. So while in reality I only made 12K, the whole Wash Sale rule, if I calculated the Wash Sales would make it look like I made 22K. So basically I am scared I may get taxed on 10k that does not even exist and I definitely did not profit from.
Honestly, when I found out that I could get taxed on non-existent money I told my wife "Now I know why 90% of traders lose, its not the market, its the IRS".
