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Forex Taxes

  • #261
  • Jan 1, 2008 8:57am Jan 1, 2008 8:57am
Ok, I did quite a bit of research on the net but can't find anything specific!!

I talked to my accountant, but he doesn't know...

Am I close? Anyone? Please?
  • #262
  • Jan 1, 2008 9:36am Jan 1, 2008 9:36am
Quoting joey122mac
Ok, I did quite a bit of research on the net but can't find anything specific!!

I talked to my accountant, but he doesn't know...

Am I close? Anyone? Please?
First I would get a new accountant.

Second, there is some basic information here: http://www.forex-day-trading.com/forex-taxes.htm

Here is more info an dlinks you can review: http://www.forexproject.com/tag/forex_and_taxes/
  • #263
  • Jan 1, 2008 9:37am Jan 1, 2008 9:37am
From what I understand it goes on line 21 (?? miscellaneous income) on 1040.

The past 2 years I have had losses, and I included it on my schedule D for stock transactions because I just assumed that. This year I have profits finally, so I will put mine on this.

I think you have to setup a business to not pay as much on the profits. I did some research a month ago. I found some of the info on FF. Do a search and maybe it will come up.
  • #264
  • Jan 1, 2008 9:39am Jan 1, 2008 9:39am
We are talking about UK tax rules - Not US.

Apologies for not being clear in the first place
  • #265
  • Jan 1, 2008 9:39am Jan 1, 2008 9:39am
Oh but I see you are in the UK. Nevermind my post.
  • #266
  • Jan 1, 2008 9:41am Jan 1, 2008 9:41am
Quoting joey122mac
We are talking about UK tax rules - Not US.

Apologies for not being clear in the first place
Sorry I can't help then. I am not familiar with UK tax issues.
  • #267
  • Jan 6, 2008 8:29pm Jan 6, 2008 8:29pm
Quoting joey122mac
Ok, I did quite a bit of research on the net but can't find anything specific!!

I talked to my accountant, but he doesn't know...

Am I close? Anyone? Please?
You talked to the wrong accountant. You need to find an account that knows the forex. You will also find other related information by using the search feature of the forum before posting your questions. In many cases, you will find your answer quicker.
  • #268
  • Jan 9, 2008 5:11pm Jan 9, 2008 5:11pm
Ive looked everywhere and still have no idea what to do for taxes in the U.S. I made a deposit in 2007 and made profit for the year. I never withdrew any money and have no plans to. Do I still need to file for taxes this year or do I only do this when I actually withdraw? Please help. Thanks
  • #269
  • Edited 5:26pm Jan 9, 2008 5:13pm | Edited 5:26pm
Quoting hndymann
Ive looked everywhere and still have no idea what to do for taxes in the U.S. I made a deposit in 2007 and made profit for the year. I never withdrew any money and have no plans to. Do I still need to file for taxes this year or do I only do this when I actually withdraw? Please help. Thanks
Check your PM my friend, answer awaits.
  • #270
  • Jan 19, 2008 10:33am Jan 19, 2008 10:33am
Since tax season is here, all forex traders are beginning to file their returns/losses.

I'm thinking of going to HR Block but I am not sure if they are 'experts' at doing taxes for traders (especially forex traders).

For those of you who are doing it, what companies do you go to? I'm not rich so I can't pay hundreds of dollars for tax return. Is HR Block sufficient for this? Cause they have guarantee if anythign is wrong with IRS they will cover for it. Plus I have a $25 coupon!

Thanks
  • #271
  • Jan 19, 2008 3:16pm Jan 19, 2008 3:16pm
Last year Merlin arranged for Trader Tax, a rep from:
http://www.tradersaccounting.com/

to answer questions in this thread.
http://forexfactory.com/showthread.php?t=8177

It's worth reading through and maybe visiting their website.
In trading, there is no bullshit. You either make money or you don't.
  • #272
  • Jan 19, 2008 5:43pm Jan 19, 2008 5:43pm
hey mr green, tradersaccounting doesn't have a very user friendly website (and very slow). I was kind of looking for something that does you whole tax return rather than just going to a differernt place for trading and another for my w2's. Unless i'm reading the website wrong, it seems the consultation may look expensive.

Sorry for putting this in the 1kt room, if the mod can move it to forex discusion that would be great to get everybody's responses. IN the meantime please pm me.
  • #273
  • Jan 20, 2008 9:03pm Jan 20, 2008 9:03pm
Quoting hilmy83
I was kind of looking for something that does you whole tax return rather than just going to a differernt place for trading and another for my w2's.
unfortunately this is a pretty good option. an accountant that understands trading (especially forex) is very expensive. from what ive seen, $250 an hour is the going rate for someone you dont have to explain things to. to have them do your whole return will cost you big time
Relax and be happy.
  • #274
  • Feb 7, 2008 9:30pm Feb 7, 2008 9:30pm
Merlin that link isn't working. Please advise on new link / thread. Thanks.

Quoting merlin
we have a trader tax expert on FF, if you post a question here you will surely get some good answers.
  • #275
  • Feb 29, 2008 8:32pm Feb 29, 2008 8:32pm
Quoting Warmagus
Look at the crappy tax code we have to put up with in America.
Why don't we get rid of all this BS and replace it with the FairTax?

The FairTax is a consumption tax everyone pays one time, at the retail level. It replaces income tax, capital gains tax, social security and medicare tax, corporate income tax, and the death tax. It completely untaxes the poor because all spending up to the poverty level will be tax free.

The US tax code is so complicated it's estimated that the cost of complying with it is 400 billion dollars a year. Lets get this albatross out from around our necks by supporting what I believe is the single most important piece of legislation on the Hill. FAIRTAX


Even if we are profitable we are robbed at Tax Time. Any other Country in the world might be better than here. We have lost all our freedoms by my 911 police ....... state. Flat Tax would cure all out tax problems. I think I should move to Macao/China, where there are no taxes or Malaysia where there still are some freedoms. This Country is as totalatarian and ugly as it gets! Hitttlerr's Deutchland was a breeze for freedoms compared to this mess! IMO
  • #276
  • Feb 29, 2008 8:49pm Feb 29, 2008 8:49pm
Quoting Warmagus
Look at the crappy tax code we have to put up with in America.
Why don't we get rid of all this BS and replace it with the FairTax?

The FairTax is a consumption tax everyone pays one time, at the retail level. It replaces income tax, capital gains tax, social security and medicare tax, corporate income tax, and the death tax. It completely untaxes the poor because all spending up to the poverty level will be tax free.

The US tax code is so complicated it's estimated that the cost of complying with it is 400 billion dollars a year. Lets get this albatross out from around our necks by supporting what I believe is the single most important piece of legislation on the Hill. FAIRTAX
Problem with that is people who spend a lot of money on things will buy large ticket items elsewhere.
  • #277
  • Mar 1, 2008 9:48am Mar 1, 2008 9:48am
Quoting TIckerShuffl
Problem with that is people who spend a lot of money on things will buy large ticket items elsewhere.
Import taxes will rob you of that. It might work fine if you're smuggling small items but large ticket/large size items won't happen. Try smuggling white goods or a car. The border might be porous but it's not that porous.
Not all sins are created equal
  • #278
  • Apr 19, 2008 9:02pm Apr 19, 2008 9:02pm
So all I have to do is to opt out of a '988' contract and get in an LLC? Where can I find a good LLC that I join in?
  • #279
  • Apr 19, 2008 9:26pm Apr 19, 2008 9:26pm
USA?

Why would you need an LLC? Are you taking it as business income or as a 1256 contract? And why?

LLCs are not something you join, they're something you setup with an attorney. It's a limited liability corporation, and it usually counts as "business profit or loss" on your 1040... as opposed to a C corp that would need to file it's own taxes. You don't need either for forex, see the IRS website pub 550 for more info.

IMO, and I'm not an accountant so you shouldn't act directly on this advice nor should you take it as a recommendation (talk w/ an accountant before taking action, but feel free to bring up your concerns since many aren't familiar with the details and need to research them), it's usually smarter to take the 1256 contract if you're working with profits and would end up in a higher tax bracket... where-as a loss or small profit usually works better the other way. Usually being that there are a whole lot of mitigating circumstances that might make that incorrect.

Do yourself a favor and grab IRS pub 550, read thru the relevant internal revenue codes then go see an accountant that's familiar with capital gains, business taxes, currency and commodity trading.
  • #280
  • Apr 19, 2008 9:43pm Apr 19, 2008 9:43pm
Nvm then, I read through some of the IRS pub 550 and decided to go for the '1256' contract.
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