Taxes for Traders

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Taxes for Traders -- What You Need to Know

David Landis

They must report the specifics of hundreds, even thousands, of trades. And they must do it in a way that satisfies the Internal Revenue Service's qualifications for trader status, which entitles them to tax breaks not available to ordinary investors.

TSC tax reporter Tracy Byrnes, with some help from TSC contributing editor Gary B. Smith, has put together a series of stories to guide traders through the maze.

The lineup:

• Trader or Investor? The IRS Wants to Know

  We examine Internal Revenue Service regulations and case law to determine exactly what separates traders from investors.

• How to File a Return That Tells the IRS You're a Trader

  We walk you through the issues and tax forms you'll encounter come April 15.

• Trade-Tracking Software: No Package Is Perfect

  How do you keep up with hundreds or thousands of trades a year? We pass along reader feedback on the best software.

• Can Traders Use TaxCut and TurboTax?

  This special edition of Byrnes' regular Saturday Tax Forum deals exclusively with trader tax issues.

• The Best Way to Handle Your Taxes

  TSC's Technician's Take columnist Gary B. Smith weighs in with his own tax strategy.

• Yahoo! Tax Chat Transcript

  Byrnes and trader tax specialist Ted Tesser, CPA and author of the Trader's Tax Survival Guide, answer readers' questions on Yahoo! Chat.