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Level 1

Is there a way to include a Section 475 when I efile with TurboTax? I need to file it for the upcoming year but do not see it in the help. Thanks!

 
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Level 1

Is there a way to include a Section 475 when I efile with TurboTax? I need to file it for the upcoming year but do not see it in the help. Thanks!

Yes; 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 Products 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.

Here is a link to an IRS.gov article that I think you should read first, before filing a tax return this way.  If the hyperlink is not clickable, then please simply cut-and-paste it into your internet browser:

https://www.irs.gov/taxtopics/tc429.html

Source: TurboTax TaxPro Geoffrey G.
9 Replies
Level 1

Is there a way to include a Section 475 when I efile with TurboTax? I need to file it for the upcoming year but do not see it in the help. Thanks!

Yes; 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 Products 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.

Here is a link to an IRS.gov article that I think you should read first, before filing a tax return this way.  If the hyperlink is not clickable, then please simply cut-and-paste it into your internet browser:

https://www.irs.gov/taxtopics/tc429.html

Source: TurboTax TaxPro Geoffrey G.
Level 1

Is there a way to include a Section 475 when I efile with TurboTax? I need to file it for the upcoming year but do not see it in the help. Thanks!

Thanks for the quick answer, a couple of clarification to make sure I understand.  The designation as self-employed trader is for 2019 tax year.  The way I read it, I file printed copies this year with the 475(f) included showing the designation for 2019.  For 2019 taxes I will treat it like a small business and include the documents you mention.  After your response, the main thing I am not clear on is the process for submitting the initial 475(f).  Overall great info, thank you!
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Level 1

Is there a way to include a Section 475 when I efile with TurboTax? I need to file it for the upcoming year but do not see it in the help. Thanks!

Refer to the Form 1040, Schedule D Instructions, Capital Gains and Losses, for more information on how to make the mark-to-market election. It's important to note that in general, late section 475(f) elections aren't allowed.
My understanding of those instructions is that the election is timely if filed with the Form 1040 for the prior year. So, if you are contemplating making the election for the 2019 tax year, all required forms and statements are to be attached to the 2018 tax return. [Edited for content. 02.17.2019 | 8:55AM]
Level 1

Is there a way to include a Section 475 when I efile with TurboTax? I need to file it for the upcoming year but do not see it in the help. Thanks!

Please note: My original comment was based on a misreading of IRS Tax Topic No. 429. The Sec. 475(f) election and attachments MUST BE FILED WITH THE 2018 TAX RETURN. Please see edited comment, above.
Level 1

Is there a way to include a Section 475 when I efile with TurboTax? I need to file it for the upcoming year but do not see it in the help. Thanks!

Thank you for the research and response. This clarifies the answer for me. I truly appreciate it have a good day
Level 18

Is there a way to include a Section 475 when I efile with TurboTax? I need to file it for the upcoming year but do not see it in the help. Thanks!

you may mail Form 4868 with the statement attached, and e-File later, but no later than Oct 15th.
Level 18

Is there a way to include a Section 475 when I efile with TurboTax? I need to file it for the upcoming year but do not see it in the help. Thanks!

see here for the real scoop.

https://ttlc.intuit.com/replies/6983829

Level 18

Is there a way to include a Section 475 when I efile with TurboTax? I need to file it for the upcoming year but do not see it in the help. Thanks!

see here for how to fill out form 4797 in TurboTax .
<a rel="nofollow" target="_blank" href="https://ttlc.intuit.com/replies/6804814">https://ttlc.intuit.com/replies/6804814</a>
Level 1

Is there a way to include a Section 475 when I efile with TurboTax? I need to file it for the upcoming year but do not see it in the help. Thanks!

@fanfare thanks for the response I think it is accurate