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Level 2
posted Mar 26, 2025 9:14:06 PM

Trader of Securities 4797 double counted?

I am an MTM elected trader of securities.  I have entered the necessary fields to have my Form 4797 properly show my gains with the "Trader of Securities - See Statement".  This is transferred to my Schedule 1 - Line 4.  However, on my Schedule C, that same amount is entered on line 1a, and propagates through the schedule C to my final profit on Line 31, which is ALSO on Schedule 1 - Line 3.  These are then ADDED together and placed on my 1040, effectively doubling my income (less Schedule C deductions).  What am I doing wrong?  


Turbotax Deluxe entered via easystep.  Any advice is appreciated!

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1 Best answer
Expert Alumni
Mar 27, 2025 5:36:05 AM

The gains from Form 4797 should not be reported on Schedule C.  For traders, Schedule C is used for business expenses only, not income.

 

Take a look at the following TurboTax help article for guidance:

 

How do I report my trader activity with or without Section 475(f) election in TurboTax?
 

1 Replies
Expert Alumni
Mar 27, 2025 5:36:05 AM

The gains from Form 4797 should not be reported on Schedule C.  For traders, Schedule C is used for business expenses only, not income.

 

Take a look at the following TurboTax help article for guidance:

 

How do I report my trader activity with or without Section 475(f) election in TurboTax?