IRS defined "investor" vs "Trader Status" as it relates to 1256 Contracts.

Discussion in 'Taxes and Accounting' started by bob2001, Mar 29, 2022.

  1. tiddlywinks

    tiddlywinks


    There is no form or process for TTS.
    TTS is based on facts and circumstances as seen in the eyes of the IRS.
    A taxpayer "claims" to be TTS. No checkbox, no form, no specific process. Greens "rules" are derived from court case law, due to the no checkbox, form, or process being available. Written footnotes on tax filings and/or corporate minutes may be useful or even required, based on business structure.

    In many, but not all cases, Form 3115 is necessary for election of the MTM change of accounting. As you point out, TTS allows the option of electing MTM. MTM change of accounting and all the associated MTM accounting benefits (wash sales, business loss limits, NOL carry, etc, etc.) are not valid without TTS.
     
    #11     Mar 30, 2022
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  2. newwurldmn

    newwurldmn

    This is one of the best posts on this topic.
     
    #12     Mar 30, 2022
    qlai likes this.