I want to do more swing trading, making only about 2-3 trades a week. Do swing traders qualify as "trader" for tax purposes? I'd still be scanning and analyzing stocks every day, just not executing trades unless I feel very confident in taking a position. Thanks.
i would think you would need to trade at least once a week to have a chance to pull it off. if you do 2-3 should work ok if you dont have another job.
You probably could if you show you made 2 or 3 trades a week, week, after week, after week. But, if you had periods of a month or 2 where you didn't make any trades at all, you might run into some problems. Here's a book that might answer your questions, better. www.esignal.com/exchange/v19_03/investors_library.asp and a web site that has some good info... www.greencompany.com/tradersarea.htm
The IRS test are extensive and essentially require that trading be your full-time avocation. If you are employed full time in another job they will probably disallow any deduction. The www.greencompany.com site does have some good info on the subject.
So, I can't elect mark-to-market with a full time job? That means, if I lose more than $3000, it won't be deductible, right? I did think, however, that the IRS allows investment publications and some costs associated with those investments (fees, etc.) to be deducted, even if held short term.