I am planning to declare MTM and I know that you need to send an attachment, but if I am planning to efile my return, do I just add a page to the electronic file, and that would be sufficient?
and everything that comes with it http://www.irs.gov/taxtopics/tc429.html * You must seek to profit from daily market movements in the prices of securities and not from dividends, interest, or capital appreciation. * Your activity must be substantial, and * You must carry on the activity with continuity and regularity. The following facts and circumstances should be considered in determining if your activity is a securities trading business: * Typical holding periods for securities bought and sold. * The frequency and dollar amount of your trades during the year. * The extent to which you pursue the activity to produce income for a livelihood, and * The amount of time you devote to the activity. ---If you have made a valid election under section 475(f), the only way to stop using mark-to-market accounting for securities is to request and receive written permission from the Service to revoke the election. Non-filing of the Form 3115 mentioned above will not invalidate a timely and valid election. To request permission to revoke your election under section 475(f), you must file a second Form 3115 and pay a fee. ---- easy to get into,not so easy to get out. specially for individual.
yes I would definitely qualify as trader...thing is, how did you guys send the attachment for declaring as MTM?
Paper file the federal extension and attach the Section 475 MTM election statement to that extension. There is no way to make that election statement with an e-filed extension.
Interestingly, you can easily qualify when trading actively , then in subsequent years back off heavy trading. In that case I don't think you lose the mtm status .
With the new 1099 rules it is important to notify your broker when you go MTM. I wasn't thinking ahead and got a 1099 with all the crazy wash sale stuff.
http://www.daytradingcoach.com/daytrading-free-educationtaxfiling.htm http://www.traderstatus.com/trader.htm
Yes, thats good info, but I'm referring to someone that simply stopped trading actively for a period of time, say 2 years. I don't think they would lose the mtm status.