If an ordinary loss... do you classify this as a "other income/loss" on the 1040 or what?
2006-10-31 15:11:35 · 2 answers · asked by Anonymous in Business & Finance ➔ Taxes ➔ United States
Excellent question! I love it when someone asks a real question that requires some research.
Most people who sell stocks for investment enter their stock transactions on Schedule D. However, if you are a "Trader", then it depends on whether you timely elected to use the "mark-to-market" method of accounting. If you did, then enter all trades (including worthless securities) you did as a Trader on Form 4797 "Sales of Business Property". If you are a Trader and did not make the m2m election, report all sales on Schedule D.
All of this can be found at the attached link. Keep in mind that Traders sometimes hold stocks for investment purposes. Keep these separate from your Trading business. They are reported just like non-Trader stock sales.
2006-10-31 15:33:38 · answer #1 · answered by TaxMan 5 · 0⤊ 1⤋
go get me some hot chocolate NOW. before i whip you.
im your master.
2006-10-31 15:13:42 · answer #2 · answered by Anonymous · 0⤊ 1⤋