Error in Choosing MTM selection.

nvrreddy · ‎March 1, 2023

I submitted a statement to IRS on Apr 8, 2022, along with my 2021 tax return, as per IRC 475(f), That was informing them that I choose to elect to adopt mark to market (MTM) accounting.

I did not stop there but also added that it will start from 1/1/2023 in the next sentence.

Latter on I found out that such declaration is actually applicable to tax year 2022.

Now my question is should I start MTM with 2022 or 2023 tax year? what is my obligation?

I appreciate if you answer this question.

MinhT1 · ‎March 1, 2023

By filing your MTM election before April 15, 2022, you could make your election effective for tax year 2022.

However, if you specify in your election letter that the election will be effective only from 01/01/2023, then your MTM obligation will be effective starting with the 2023 tax year.

Please read this IRS document for more information.

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