The use of Exchange Traded Funds ("ETFs") that make non-dividend distributions ("NDDs") inside a mark to market ("MTM") account somewhat runs contrary to the purpose of a Trader in Securities ("TIS"). It is an arguable position, but the purpose of NDDs, especially ones that focus on a covered call strategy within the ETF, is more suited to investments to generate income and retirement accounts rather than capturing profit in response to short-term movements in the market. Distributions from...

Those who have both investment accounts and trade as a Trader in Securities with a mark to market election realized the tax characteristics of both types of accounts are significantly different and may want to take advantage of those characteristics by transferring securities between the two accounts in order to take advantage of those characteristics. Some possible reasons to transfer securities between investment and MTM accounts: Unrealized loss exceeding the $3,000 limitation in an...

Tax straddles are some of the most complex tax rules in the Internal Revenue Code and can appear in unanticipated situations. Tax straddles are designed to restrict a trader from deducting losses before recognizing gains associated with a particular trade or trades. A tax straddle is an offsetting position in securities if there is a substantial diminution of the risk of loss with regard to holding one or more other position. For example, the classic straddle example is being "short against...