It does not matter what time of day you trade, nor really for how long - the IRS says that: Special rules apply if you are a trader in securities, in the business of buying and selling securities for your own account. This is considered a business, even though you do not maintain an inventory and do not have customers. To be engaged in business as a trader in securities, you must meet all of the following conditions: 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 cases that the IRS wins in Tax Court typically do not meet the last two items. They seem to look at returns containing a Schedule C for trading, along with a W-2 from a "real" job. Jack