Solved: Mark to market election under section 475(f) questions

E9591CA009 · Feb 25, 2023 10:09:41 PM

In tax year 2022, I had more than enough daily trading activity to qualify for TTS since end of June 2022. In 2022, I also formed a single member LLC taxed as an S-corp but did not have any activity on the business, did not start the business brokerage account, did not do anything with the business so the taxes will be pretty bare for the business. In January 2023, I started the business brokerage account for the S-corp and have been trading on that ever since and will continue to exclusively trade on that account. I would like to make the MTM election for 2023 year on the 2022 taxes. Would I include the MTM statement, that states 1) that you're making an election, 2) the first tax year which it's effective, and 3) the trade or business for which you're making the election, to the personal income tax return or to the tax return for the S-corp? Also, for the trade or business would I just specify that it is for the S-corp and give the name? And also, the form 3115 with the tax return, would this be attached to the personal income tax return or the tax return for the S-corp? For this whole process, the deliverables that I will need to send are 1) income tax return, 2) S-corp tax return, 3) MTM statement, 4) form 3115 with tax return, and 5) form 3115 to the IRS national office at 1111 Constitution Ave., NW Washington, DC 20224. Are there any other deliverables that I need to send to get this election done? And lastly, it is my understanding that I need to file these tax returns/deliverables through the mail. Is this true and are you aware of a deadline for sending it through the mail? Thank you so much

Mark to market election under section 475(f) questions

You need to not enter it into the SEP contribution section and enter it directly into the associated business' section. Pay attention to the amounts - if you're associating it with one business you are limited to 20% of that business' income instead of your overall self-employment income. Enter it as an expense directly into the associated business labeling it as what it is.

@dc20222023

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