Daytrading Taxes

[importdistributors]

I heard that DayTrading taxes are at 33%. but my question is when you do taxes, and you put on expenses, does that cancel out an equivalent amount of taxes? Example, Say I made 11,000 daytrading stocks, and my fees I paid to Scottrade were 1,000 dollars. Does that mean that they only tax 10,000 dollars? meaning I get to keep 6,666 dollars? If thats the case, why do people choose online stock brokers that have the cheapest commision, what is the benefit?

 

[NoShangriLa]

I'm not familiar with US tax law, but here in Canada day trading is subject to income tax, and depends on the circomstances swing trading also can be subjected to income tax. Yes, fees are deductable before income tax apply to the income. Choice of stock broker depends on how much you make a trade, or what category you fall under in swing trading.

 

[DisgruntledVirus]

You started a thread why?

 

[FelixDeCat]

$11k doesnt put you in the 33% bracket if its your sole source of income.

 

[IHateMyJob2004]

Wow, talk about day taders that don't understand the most fundamental things about investment.

You need to learn about cost basis, wash sale rules and a mess of other laws. Since you "day trade" it sounds like you are in for a nightmare.

The first thing you should have done is set up a method of tracking all your entrances and exits of positions.

Are you technical classified as a day trader? 5 1 day round trips in 5 consecutive days I think is the qualification.

Also, be familiar with "return of capital" which his usually an issue with some REITS. If a company makes less than the amount of dividends paid out in a year, anything beyond earnings that is paid as dividends is not taxable as dividends. They adjsut your cost basis.

 

[chibichanman]

3 day trades, in a 5 day rolling period.