I've stock transactions that I need to import into Federal Form 4797 (not Form 8949 where they normally go). Is there a way to do that in TurboTax?

[Critter]

Why do you think they go on the form 4797?  

[sonnycvng]

Because I've selected MTM with the IRS and the instructions said to put them on 4797 instead of 8949.

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[Helenus]

Trader Tax Status (TTS) Traders that have selected Section 475 MTM have at least 740 trades.  What trader would manually type their trades on 4797?  I believe sonnycvng wants TurboTax Premier to automatically transfer the trades from form 8949 to the form 4797--not type in the transactions manually.  Sonnycvng's question has NOT been adequately answered...

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[Helenus]

I don't understand your reply.  Trader Tax Status (TTS) Traders that have selected Section 475 MTM must put their transactions on part II of Form 4797.  Sonnycvng apparently meets the TTS requirements, and also has chosen Section 475 Election, so per the Form 4797 Instructions "Gains or losses treated as ordinary gains or losses, if you are a trader in securities or commodities and made a mark-to-market election under section 475(f)" are to be reported on part II of Form 4797.  See <a rel="nofollow" target="_blank" href="https://www.irs.gov/pub/irs-pdf/i4797.pdf">https://www.irs.gov/pub/irs-pdf/i4797.pdf</a>

[sonnycvng]

Thank you both for your inputs.  BlackSwan, I agree with you that we still need to provide the transactions on Form 4797 (this could be a copy of the broker statement, my manual entries or any other ways to provide the information to them.  My whole point was “will I be able to do that automatically via TurboTax so that I could file electronically”.  From what I understand so far, TurboTax will not be able to do that so I need to do what I had been doing and that’s to file manually.  Unless TurboTax could come up with a solution, I don’t know if we need to debate this further.  Thanks again for your feedback.  

[Helenus]

Yes, Sonnycvng, it would be most excellent if TurboTax (Trader's version?) would make it convenient to transfer transactions from Form 8949 directly into Form 4797.  Maybe a competitor will...

[sonnycvng]

One could only hope :)!

[Critter]

All you need to do is make one summary entry in the 4797 section ... you do NOT need all the individual transactions.

[Helenus]

Hi Critter#2.  Thanks for re-joining the discussion.  For each page of Form 8949, line 1, there are 14 rows for trades.  However, for Form 4797, there are exactly 4 rows for line 10.  The special instructions (located on page 8 <a rel="nofollow" target="_blank" href="https://www.irs.gov/pub/irs-pdf/i4797.pdf">https://www.irs.gov/pub/irs-pdf/i4797.pdf</a>) for traders who choose Sec 475 MTM Election say this:   "Attach to your tax return a statement, using the same format as line 10, showing the details of each transaction. Separately show and identify securities or commodities held and marked to market at the end of the year. On line 10, enter 'Trader—see attached' in column (a) and the totals from the statement in columns (d), (f), and (g). Also, see the instructions for line 1, earlier."  There is no mention of a "summary entry."  So, I am not sure what it is that you are calling a summary entry, and how it relates to the special instructions.  Could you clarify?

[Helenus]

Hi Critter#2.  Thanks for re-joining the discussion.  For each page of Form 8949, line 1, there are 14 rows for trades.  However, for Form 4797, there are exactly 4 rows for line 10.  The special instructions (located on page 8 <a rel="nofollow" target="_blank" href="https://www.irs.gov/pub/irs-pdf/i4797.pdf">https://www.irs.gov/pub/irs-pdf/i4797.pdf</a>) for traders who choose Sec 475 MTM Election say this:   "Attach to your tax return a statement, using the same format as line 10, showing the details of each transaction. Separately show and identify securities or commodities held and marked to market at the end of the year. On line 10, enter 'Trader—see attached' in column (a) and the totals from the statement in columns (d), (f), and (g). Also, see the instructions for line 1, earlier."  There is no mention of a "summary entry."  So, I am not sure what it is that you are calling a summary entry, and how it relates to the special instructions.  Could you clarify?

[Helenus]

Are there any Trader Tax Status traders electing Sec 475 MTM out there that can enlighten us as to whether TurboTax will automatically transfer trades from Form 8949 to Form 4797?  

[Critter · Accepted solution]

TurboTax can certainly handle the type of return required for a self-employed commodities trader; but it will require a little bit of work and effort.

Essentially, after declaring yourself as a securities trader (if you objectively meet the criteria) you will then need to print and file your tax return on paper (not e-file) and attach a statement to the back of it declaring what is known as an IRC (Internal Revenue Code) Section 475(f) election.  Next, you will enter your business expenses as a securities trader on a Form 1040 Schedule C, inputting your expenses only and showing no income from this particular business activity (i.e., trading).  Finally, you will manually add a Form 4797 to your tax return, and enter your net total gain / loss in Part II of Form 4797, using the TurboTax smart worksheet.

Please note that you will want the TurboTax desktop software to correctly do this; the TurboTax online program will not be adequate, because you will not have access to the "Forms Mode" of the software.