How do taxes work with Forex?

I can’t find much about this topic on BP. Anybody got some real workd experience with this? Opt out of Section 988? I’ve got losses. What’s my best bet?

thanks for the help!

You’re probably best talking to a financial advisor. There are lots of complexities when it comes to tax law. Only a professional will be able to give you a solid answer.

Does anyone know at least what the base rate of taxation is in the U.S. for profit gains from currency speculation? Assume a private, non-incorporated individual filing with just federal tax liability alone.

Information about How To File Taxes for Forex and Currency Trading | hopefully that will give you some insite.

Yeah, they link to another page in that article with some specifics. It does look like a healthy capital gains tax rate, much higher than commodities.

Looks like filing Section 1256 is the better of the two, with a 60/40 rate:

[li]60% of the total capital gains are taxed at 15% which is the lower rate[/li][li]40% of the total capital gains can be taxed to as high as 35%. This is the ordinary capital gains tax.[/li][/ul]
Yeesh. Thanks for the link, Reaper. :cool: