TRADERS
SERVICES: TAX PREPARATION: PRIOR YEAR RETURNS

Late filed and/or prior years tax returns:

Many traders have not filed their prior year tax returns for various reasons:
Some traders missed the October 15th extended deadline because they were either too busy or had other problems. Filing late may or may not be a problem. Click here to learn more. We suggest you sign up with our firm now. We can prepare your tax return within a week's time if you give us all the tax information we request.

Some traders may have large trading losses, figure they don't owe taxes, so why bother filing at all. They figure it's a hassle and it costs money to hire a tax preparer. Be aware that it's only a matter of time before the IRS sends you a tax notice demanding that you file a return. Also be aware that the IRS won't know you have trading losses, and instead they will send you a tax bill for trading gains based on all your stock proceeds and not cost basis. This means that the IRS will think your entire stock proceeds is your trading gains. Plus they will add penalties and interest. Don't be shocked if the tax bill they send is several thousands of dollars. Remember, the IRS is sent all Form 1099s from your brokers.

We strongly advise you to contact our firm for help now. We can calculate your correct trading gains or losses for tax purposes. For example, maybe you mistakenly believe you could deduct all your trading losses against your other non-trading income, but since you don't have mark-to-market accounting, you are limited to net capital losses of $3,000 against you other income. In that case, you may owe taxes, where you thought you did not. The same problem can exist because you are forced to defer wash sales and/or straddles. Don't remain in the dark, engage us to prepare your tax return, before the IRS does this for you are great disadvantage to you. If you have mark-to-market accounting, you may be leaving large tax refunds on the table, which we can file for ASAP, before the year's expire.

Some traders have trading gains, but they can't pay their taxes due because they lost their prior trading gains in the stock market in the following tax year(s). Many traders have this predicament and they are in big trouble with the IRS. Don't mistakenly believe that you are ok because you have not yet received a tax notice from the IRS. It is only a matter of a short period of time before you get your IRS notice and tax bill (see above).

We strongly advise you to contact our firm for help now. We can calculate your correct trading gains (maybe losses) and trading business expenses. We can review your trading activity and if you qualified for trader tax status, we can file your return as a business trader for many additional tax advantages. We may be able to reduce your tax bill considerably. We also can work out a payment plan with the IRS and seek the abatement of all penalties (up to 25% of your tax bill plus more if negligence penalties). It is better to act before you get a tax notice.

What happens if you file your tax returns late, after the 10/15th deadline?

If you file late, and you do not owe any taxes with your tax returns (e.g.. a refund return), there will be no tax penalties or interest charges.

If you file late, and you do owe taxes with your tax returns, there will be tax penalties (of 5% per month) and interest charges assessed only on the taxes paid.

Important notice for traders who elected MTM for prior tax year that is late:
You must file your tax return together with your Form 3115 (Change of Accounting Method) by the tax filing deadline of 10/15. If you file late, you stand to lose your MTM status, which can have significant negative consequences on your tax return. If you elected MTM prior to the recent tax year, this notice does not apply to you.