SUBJECT: Clarification: Trader Tax Status (TTS) with 475(f) — Schedule C vs Schedule D (Screen 17) entry

nistax

Hi,

I’m modeling a client with Trader Tax Status (TTS) and a Section 475(f) mark-to-market election for their trading activity.

Right now, all stock trades and dispositions are entered on Screen 17 (Schedule D – Dispositions). I want to confirm the correct setup for a TTS trader:

1. Should the trading gains and losses (mark-to-market ordinary income) be reported on Screen 16 (Schedule C – Business Income) instead of Screen 17?

2. Should trader-related expenses (internet, software, data subscriptions, etc.) also go on Schedule C, in the expense section for that same trading activity?

3. For business assets like a laptop, desk, or monitors, should those be entered on Screen 22 (Depreciation) and linked to the same Schedule C activity so depreciation flows correctly?

I just want to confirm that trading income should not remain on Screen 17 and that asset depreciation should be linked properly to the trading business.

Thank you,

George4Tacks

https://accountants.intuit.com/support/en-us/help-article/internal-revenue-service/entering-day-trad...

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