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The election must always be made a year in advance ... this has always been the rule so if you want to make the change you must do it with a timely filed return for the next tax year. Wash sales do not come into play when you use the Mark to Market option. Please seek information from your broker ... a face to face conversation where you can ask questions and get immediate answers may be the best thing for your understanding of this matter ... you have about 8 months to get educated.
Read the info under Capital Gains & Losses :
https://www.irs.gov/help/find-information-on-complex-tax-topics"
@Critter-3 Thank you, I have read that and the 3K limitations on losses and the stipulations for have the status applied. This was my last stop to try to make things clearer. I even asked my broker and informed me about the loss being applied to the Cost Basis of the next stock purchase.
I get it, with all my questions it may seem like I did not do any reading, but I only came here when it was clear that I could not get a straight answer from other sources. Like I literally read multiple articles where CPAs got sued because they did not fully understand the rule and as mentioned I even ran my own little online business for a while. So my thinking was the only person who would know better is a more seasoned daytrader who has been through this multiple times, that they would be able to clear up the confusion on the Wash Sale Rule.
So no take on this:
But without the Mark to Market Election, since from everything I read elsewhere and seen here, if I am accepted for it, the election would not actually take affect until next tax year. Which means this year in order to book any real losses and get those losses deducted from my gains, I just need to stop trading in November or October?
Basically, I am trying to understand that the Wash Sale rule does not some how make losses magically disappear. Like if I took a loss on a stock and want to book that loss, I just need to stop trading in October or November and then everything is good to go. My losses become realized and my actual gain (currently 12K) is the only gain I have to worry about the IRS taxing me on.
Either way @Critter-3 thank you for all of your responses and I will as stated award you the best answer. However, its looking like at this point I am going to have to wing it, stop in October and hope for the best.
