COMPLIANCE FOR INVESTORS
Tax compliance, including tax preparation and planning
of federal and state income tax returns for investors,
business traders, proprietary
funds, and management companies (both individuals and entities) is
our core business. We have many non-trader clients, too.
There are some key differences between investors and
- While business traders enjoy more tax breaks than investors, both
face many of the same tax-compliance challenges and pitfalls. Active
securities traders face headaches with cost-basis
reporting and Form 8949, whether they rise to the level of trader
tax status (business treatment), or not. It's often unclear whether
an active trader qualifies for trader tax status, and our CPAs make
that determination during our tax compliance service, when we have all
the facts, circumstances and frequency of trades in front of us. We
do much of the same work for both investors and business traders. Click
here to read more about the differences in investors and business
Our tax compliance services for investors (click
here for our retainers):
- If you need help using
TradeLog software for your trade
accounting on securities, consider our TradeLog
- Our 2012 tax preparation service covers 2013 tax
- Late entity tax returns are subject to late filing penalties
in all cases. See the IRS
Information About Your Notice, Penalty and Interest and scroll to
page 2, #32. Late filing may be tolerable in some cases -- contact us
for details. While we recommend trading entities to business traders,
some investors have entities, too.
- If you elected Section
475 MTM for 2012 on your existing entity or as an individual sole
proprietor business trader - and you don't qualify for trader tax status
in 2012 - the Section 475 election is null and void. In that case, you
don't have to file a Form 3115 (Change of Accounting Method). You will
have to re-elect Section 475 MTM in the subsequent year if you desire
that accounting treatment.
- If you don't file your tax returns on time, file for an automatic
extension, which is valid if you pay 90% of your tax liability
with the extension. Learn more about extension strategies, and special
hardship relief (Form 1127-A) in our blog.
Include your Section
475 MTM election with that extension too if you want that important
election. The automatic extension is until Sept. 15 for partnerships,
LLCs filing as partnerships and S-corps, and Oct. 15 for individuals,
including single-member LLCs that are disregarded entities. It's better
to sign up with us before the extension so we can deal with trader tax
status and the mark-to-market election strategy on time. There are consequences
for missing tax filing and election deadlines, including penalties and
jeopardizing tax treatment.
- If you plan to qualify for trader tax status in 2013, now is an excellent
time to form a new entity for 2013. Learn
more on our entities page. See our new ideas for using entities
to avoid Obama-era tax hikes on upper-income individuals in our Webinar
fiscal cliff tax planning for traders and key trader tax issues to consider
for 2012 tax preparation.”
- Prior Years: We are happy to help you with late tax
returns, NOL carryback returns, and amended returns.
Why hire our firm?
- Why choose us? Most accountants aren't familiar with trader tax savings
strategies, and it's well beyond the parameters of what these services
and local accountants can offer. We offer you the most prudent ideas
for tax savings (as laid out in Robert Green's The
Tax Guide for Traders and Green's
2013 Trader Tax Guide). Many local accountants and preparers
are struggling with the new IRS cost-basis
reporting rules and Form 8949. We hear horror stories of CPAs and
retail store front accountants relying on 1099-Bs, even though there
are widely-known errors on wash sales and more.
- If you use a local tax professional, find out if they are qualified
to deal with your special tax needs. Ask if you qualify for trader tax
status, if you can use Section 475 MTM ordinary loss treatment, how
to handle ETF options and spot forex, if you can do a retirement plan
contribution and deduct health insurance premiums in connection with
your trading gains, if you owe self-employment tax on trading gains,
and what types of business or investment expenses you can deduct (i.e.
if education is included). If they draw a blank on any of these questions,
walk away. With complicated new 1099-Bs coming again this tax season,
it’s another reason to use our services.
- Tax preparation is our most popular service and we guarantee you
will be very pleased with our great prices, fast service and wonderful
customer experience. Just read our many great testimonials.
We've been the respected,
trusted and leading CPA firm for online traders since day one. We
have the best, most
experienced trader-tax preparation CPAs in the country.
- Our CPAs will help you determine whether to use "trader tax
status" or "investor tax status." This key decision unlocks
all the trader tax benefits.
All of our retainers are $625. Unsure which service
is right for you? Don't worry, we'll figure it out together after you
sign up. Simply choose one below to get started. Hedge funds sign up
for a different retainer here.
Free complementary access to Green's
2013 Trader Tax Guide (a $39.95 value) comes with any of our below
tax compliance retainers. Please read this guide, or just the parts
that draw your interest. We find that an ‘educated consumer is
our best customer.’ In addition to focusing on your 2012 tax compliance,
we want to help you with 2013 tax planning.
INDIVIDUAL TAX RETURN
(Most clients choose this retainer. It's for
trading in your own individual name — or SMLLC disregarded
entity — if you are a business trader or an active investor.
We will figure out your correct status during our engagement.)
PARTNERSHIP TAX RETURN
(Choose this option if you had a general
partnership, multi-member LLC or LP during the year. If you
want our CPAs to prepare your individual tax returns, then
also purchase the individual retainer.)
S-CORP. TAX RETURN
(If you had an S-corp. or SMLLC
electing S-corp treatment during the year, then choose this
retainer. If you want our CPAs to prepare your individual
tax returns, then also purchase the individual retainer.)
CORPORATION TAX RETURN
(If you had a C-corp. during
the year, then choose this retainer. If you want our CPAs
to prepare your individual tax returns, then also purchase
the individual retainer.)
OTHER TYPE OF TAX RETURN
(Choose this retainer for other types of returns, including
trust, estate, retirement plan, or if you're unsure of which
retainer to choose.)
Learn more about our tax preparation service:
Organizers, Deliverables & Accounting Issues: What you can expect
to receive with our service.
advantage: Why you should select us as your trader tax preparer.
process: Efficiency, effectiveness, documentation, convenience, and
exams: How we'll represent you in front of the IRS (if that unfortunately
year returns to see if you benefit from an amended return.
Retainer, fees & quotes.
Traders: We also recommend that proprietary traders sign up for our tax
preparation services. Learn more in our proprietary
trading tax section and then return here to sign up.
Returns: Oct. 15 was the extended due date for filing prior year individual
tax returns, but we still welcome you to sign up for our tax return preparation
services. We are also still preparing and fixing prior year tax returns
for many clients. Click
here to see how we can help.
e-filing most federal and state tax returns again this year.
We simply push a button in our software and your return is filed. E-filing
is easier and less expensive than delivering paper returns, and your tax
return and refunds are processed faster.
Good news! Starting with 2012 tax filings, the IRS is accepting
pdf attachments with e-filings of individual tax returns; which they only
allowed on entity e-filings in prior years. We no longer have to mail
large TradeLog reports with Form 8453, separate from the e-filing.
If you have any questions about our trader tax preparation services, please
contact us at firstname.lastname@example.org
or call us.
our tax preparation service, we distinguish between "Investors"
- While both may be active traders with complex tax treatment and accounting
issues for trading gains and losses, business traders get unlimited
business deductions, while investors can't deduct home office and education
expenses, plus investors face many restrictions on allowable investment
expenses. The average tax savings for business traders versus investors
is around $8,000. But, investors still need us to make sure their trade
accounting is correct and to maximize investment expenses. More importantly,
we use our industry-leading judgment to determine if you qualify for
trader tax status. We often help clients qualify in the current year,
while we prepare their tax returns for the past year. In many cases,
if you qualify in the current year, it's better to capitalize your prior
year investment expenses to deduct them as start-up business expenses
in the current year. Investors need us too and we offer them a break
on our fees.
- Business traders may also elect (on time) Section 475 MTM ordinary
loss treatment on securities, avoiding wash sales and capital loss limitations.
Some clients have gotten refund checks in the hundreds of thousands
of dollars from net operating loss (NOL) carryback returns, and they
couldn't get any of that as an investor. One key strategy that we utilize
is dealing with significant capital loss carryovers. You want subsequent
capital gains treatment to use up capital loss carryovers. That can
include capital gains passed-through from a new trading entity. Yet,
if you have new trading losses, you prefer Section 475 MTM ordinary
business loss treatment. We navigate out of this hole with entities.
See our entities
page to learn more. Again, if you're an investor and becoming a business
trader soon, we can help you with these strategies too.
- Business traders should consider forming an entity to save taxes
with retirement plans and health-insurance premium deductions. Although
investment companies can try these strategies too, they're often tax
inefficient and potentially costly, with self-employment taxes costing
more than income tax savings. For business traders, it's almost always
tax beneficial with net savings of several thousand dollars up to $17,000
for a married couple. Click here for a retainer