IRS reporting?

[reptile411]

Ok so many of you know my good luck the other day so here is my question I fully plan to obey the law and report my earnings but a friend said I had to report it right now because it was over 10K is that true? My total take was about $11,250 but 6K of that was my initial investment so my profit was only $5.250. Can I just wait until I do my 09 tax return to report my earnings from this or do I need to take some sort of action now as I was told? Also according to my figures I payed about $400 in commissions on the triad, dose that get reported as a loss or do I just suck it up and deal with that? Thanks a million.

[disneysteve]

I'm not sure about your reporting issue but the commission on the trade is not a loss. It just gets applies toward your cost basis so it gets deducted from your profit.

[KTP]

heh, it is a good thing you plan to obey the law and report earnings, because for sure your investment broker will report to the IRS your gains. It is a good question at what point do you need to report a large gain assuming you do not have other losses to offset it?

[reptile411]

Yes I report everything. I really don't want to be Madoffs cell mate lol

[MonkeyMama]

I didn't catch where the money came from, but I am not aware of anything off the top of my head where you would have to report current year income "immediately." When you file your 2009 tax return should be fine, for 2009 income...

[disneysteve]

MonkeyMama, the money was from a stock trade.

[Russell]

From what I understand you report it as regular income (for short term capital gains). You may want to read through this:

2008 Instructions for Schedule D (2008)

[MonkeyMama]

A stock trade during the year 2009 I assume (sounded like it was something along those lines).

[southerndoc]

I didn't catch where the money came from, but I am not aware of anything off the top of my head where you would have to report current year income "immediately." When you file your 2009 tax return should be fine, for 2009 income...

You have to pay at least 90% of your predicted tax through quarterly payments, but there are clauses for factoring in prior years' taxes.

For instance, I'm an independent contractor. If I don't make quarterly payments and instead make one lump sum payment on April 15th, I'll get hit with a large penalty and interest.

Your best advice is to speak to a CPA.

[reptile411]

Cpa??????????????

[momof1in150]

You have to pay at least 90% of your predicted tax through quarterly payments, but there are clauses for factoring in prior years' taxes.

For instance, I'm an independent contractor. If I don't make quarterly payments and instead make one lump sum payment on April 15th, I'll get hit with a large penalty and interest.

Your best advice is to speak to a CPA.

Monkeymama is a CPA

[KTP]

The way I understand it, when you file taxes you don't want to owe more than a certain amount for that tax year (is this modified by how much you owed the previous year? I think so). Of course if you have capital losses from previous years you can usually carry those foward to offset these gains. Also you could sell some other poor performers in your portfolio before the end of december to offset this gain.