without the 475(f) election the only difference in reporting, assuming you qualify as a trader, is that expenses go on schedule C rather than not be deductible at all as an investor for federal tax purposes. your security sales are still reported on form 8949/schedule D.
since schedule C produces a loss and capital gains/losses, dividends and interest don't count for QBI but an SSTB includes:
- Trading, including the trade or business of trading in securities (as defined in section 475(c)(2)), commodities (as defined in section 475(e)(2)), or partnership interests;
maybe I should have added the schedule C loss would be a QBI loss which could affect your QBI deduction if you have other activities that produced QBI income. The SSTB classification would make a difference if you had other activities producing QBI income that were also SSTB because there is a netting concept in the QBI computation. For example, if you were also a lawyer that income is also SSTB income so this SSTB income would be netted with the SSTB schedule c loss.
475(c)
(2)Security defined
The term “security” means any—
(A)share of stock in a corporation;
(B)partnership or beneficial ownership interest in a widely held or publicly traded partnership or trust;
(C)note, bond, debenture, or other evidence of indebtedness;
(D)interest rate, currency, or equity notional principal contract
IRC 199Aa(C)(3)(B)
(B)Exceptions
The following items shall not be taken into account as a qualified item of income, gain, deduction, or loss:
(i)Any item of short-term capital gain, short-term capital loss, long-term capital gain, or long-term capital loss.
(ii)Any dividend, income equivalent to a dividend, or payment in lieu of dividends described in section 954(c)(1)(G). Any amount described in section 1385(a)(1) shall not be treated as described in this clause.
(iii)Any interest income other than interest income which is properly allocable to a trade or business.
