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Question: Do day traders or forex retail traders fall under the short term capital gains tax?

(Posted by: Peter G on 2010-01-28 12:04:36)

I have been living in California for over a year but haven't applied to vote in the state. My car is also registered in California. Does that technically make me a California resident and pay their stupid income tax rate? I was a Montana resident before.

Posted by: sunshine on 2010-01-28, 12:07:36

If you hold stock for short term then yes. It is the transaction that is a short term not the trader

Posted by: intheleast on 2010-01-28, 12:10:46

Short term gains are gains on assets held for one year or less. Therefore, income from day traders would fall under that category if they hold the stocks they purchased for one less than a year + a day. Forex operates the same way, so you would have to hold the currency for more than a year before selling in order to avoid short-terms gains tax.

Posted by: Mathew on 2010-01-28, 12:11:31

Day traders or forex retail traders rarely hold anything for more than a year and that makes any gains short term. Each trade is considered separately not the annual amount for all trades.