I am doing my taxes and I have a loss for 2009. I daytraded in a prop firm. Turbo Tax asked me this question: Did you "materially participate" in the partnership? Do you know answer to this?
Well, after 10 seconds on google, first response is: http://biztaxlaw.about.com/od/glossarym/g/materialpartic.htm Seriously, learn to use the web search. It is liberating not to be dependent...
you will want to see a competent tax attorney / service on these trader only type tax questions attend one of the Trader Expo's or their website and see who advertises their tax services and read their books, as well as pay for their services you won't regret that investment taxes for traders continues to be a fluid topic to the IRS and their examiners and enforcers just imagine a few buff 6'8" leg breakers coming to a monitor screen near you.... that's what they look like when the men in black come for you they hold you up, suspended in the aire by your ankles, waiting for coins to drop out of your purse, skirts, pants, durka(s) or whatever you're wearing....