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Shane-CPA
Shane-CPA, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 265
Experience:  Shane Northrop is a Certified Public Accountant, Personal Financial Specialist and a Chartered Global Management Accountant
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I trade Futures and I get a 1099 B last year It showed I made

Resolved Question:

I trade Futures and I get a 1099 B last year It showed I made alot of money as of close Dec 31,2011... but I was not out of the postions till this april and I lost all the gain from 2011 and then some The thing is I filed a form 6781 and had to pay alot of tax to the IRS on gains I never got Is there anyway to refile my tax's to show I never had that gain
Submitted: 1 year ago.
Category: Tax
Expert:  Shane-CPA replied 1 year ago.

Shane-CPA :

Hello...my name is XXXXX XXXXX I am a Certified Public Accountant. I look forward to assisting you with your tax question.

Shane-CPA :

Futures are taxed according to IRS Code Section 1256 which treats gains and losses as a split for tax purposes as 60% long-term capital gains and 40% short-term capital gains regardless of holding period.

Shane-CPA :

What you are describing is a common situation for traders who make a significant amount of profits in one year only to lose them in the first few months of the next year.

Customer:

I know that, what I want to know is this the right form and is there any way to do my tax's over for 2011 so I do not have to pay on money I never made I know you can write off the loss $3,000.00 a year but it will take for ever and claiming that gain put me in a real high tax bracket

Shane-CPA :

I am checking on the capital loss rules to see if they will allow carryback to prior years...one moment...

Customer:

no rush

Shane-CPA :

Were you trading futures using a company or in your individual name?

Customer:

in my name and my husbands no company

Shane-CPA :

Unfortunately, capital loss rules only allow carry forward to future years (not to prior years)...your only hope would be to possibly look into showing that you were operating as a sole-proprietorship to see if you could obtain a net operating loss carryback for a company...however...that may be a tough argument to support...

Customer:

so my accountant is doing this right you pay on what is there at the close Dec 31 of the year wheather you end up with that or not?? and this is the right form for futures6781

Shane-CPA :

That's Correct...in the following year you will have a capital loss as you mentioned which will carry-forward...I know it doesn't help you much for the prior year...it is a common problem for many traders...

Shane-CPA :

everything at 12/31 is mark-to-market with futures...

Customer:

is it still only $3,000.00 a year to use as a loss

Shane-CPA :

unless you have capital gains in future years...so if you make money in investments in the future...it will offset those amounts on a dollar-for-dollar basis at no limit

Customer:

thanks alot have a great new year

Shane-CPA :

thank you...you as well

Shane-CPA :

have a great evening!

Shane-CPA, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 265
Experience: Shane Northrop is a Certified Public Accountant, Personal Financial Specialist and a Chartered Global Management Accountant
Shane-CPA and other Tax Specialists are ready to help you
Expert:  Shane-CPA replied 1 year ago.
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