Day Trading

March 9, 2021

The IRS has special rules that apply if you’re a day trader. And if you qualify, they consider you a business and self employed. ⁠

But to be in this business, you must meet all the following conditions:⁠
1️⃣You must be trying to profit from daily market movements⁠
2️⃣Your activity must be substantial⁠
3️⃣You must trade continuously and regularly⁠

Some factors go into determining this such as…⁠
How long you hold the securities you buy and sell. ⁠
How often and how much you trade each year. ⁠
Are you trading to make a living from it. ⁠
How much time are you putting in. ⁠
You must keep detailed records. ⁠

So if all these apply, you’re considered a trader. Otherwise you’re an investor. ⁠

If you’re considered a trader, you may benefit from special tax treatment.

Happy Trading!

Disclaimer: For informational purposes only. Not Tax or Legal advice.