IB FX Tax calculations question

Discussion in 'Forex' started by nravo, Aug 6, 2009.

  1. nravo


    I am going through my annual hair-pulling exercise with IB with regard to my FX trades and I just noticed in the CASH REPORT on the annualized calendar transaction summary, something called CASH FX TRANSACTION GAIN/LOSS. What is this? P/L foreign stock and futures trades reconverted back into dollars? It can't be my P/L from cash FX trades, as IB admits it does not summarize those. Thoughts?

    (Apologies for the cross post; I wasn't sure which FX forum would be best for this post.)
  2. The cash FX translation gain/loss covers all changes in value to your FX account as measured against your base currency. This would include some FX trades (i.e. that don't originate with USD) as well as changes in the value of your foreign currencies as measured against the USD. To me it's essentially a plug number to keep everything in balance.

    It cannot substitute for your FX trading income. For example, if you buy and sell Euros in a day, the translation gain/loss will not reflect this since your gain will be in USD, not Euros.
  3. nravo


    So, it's not something relevant/reportable for tax purposes, right?