While plenty of trading gurus and twitter traders like to talk about how transparent they are, most say little about themselves or their trades. Many go by aliases, many post their trades only after they have supposedly made them, or put their trades up on their website, pretending that by posting a trade on their own website with no third-party verification it somehow proves they made the trade. Screw them all! I have nothing to hide so I am posting below details from my past tax returns. Furthermore, I have directly imported all my past trades (where that was possible) to Profit.ly. I went back and hand-entered trades from accounts I could no longer auto-import from. See my trades on Profit.ly here. This listing of my trades is not guaranteed to be correct — I am sure that there are small mistakes in trades I hand-entered and auto-importing of trades appears to have missed a few trades. That being said, my record on Profit.ly is an honest accounting of my trades and is very close to the gains that I have reported to the IRS.
Besides the trades that I have posted on Profit.ly, I thought I could provide a bit more information on my trading gains. From 2007 until January 1, 2011, my trades on Profit.ly show $497,167 in profit. For the tax years 2007 to 2010 I reported to the IRS $510,553 in gross trading profit (this excludes long-term capital gains and expenses other than commissions). See below for details.
I do not have electronic copies of my tax returns from this year.
Long-term capital gains: $12,386
Gross trading profits (short term capital gains on Schedule D): $58,697
I did not have enough trading activity to file as a business trader in 2007 so most of my (modest) trading expenses were not deductible.
The vast majority of my trading in 2007 was in my individual Interactive Brokers account, since closed. See the 59-page PDF activity statement showing all my 2007 activity.
Schedule D long-term gains: $5,030
Schedule D short-term gains: $203,726
Add back trading gains transferred to Schedule C: $31,451
Add back loss on private company LLC investment: $18,633
Gross trading profits: $253,810
Trading expenses: $31,451
Net trading profits: $222,359
Starting in 2008 I began filing as a business trader, which allowed me to deduct trading-related expenses. Because of the special tax treatment that business traders receive (deductible expenses but no self-employment tax) my accounting firm transfers as much income from Schedule D to Schedule C as is necessary to zero out the trading expenses.
Almost half of my trading expenses, $14,189, were due to interest (almost all of which was a loan from a family member for funds I used for trading). Getting a sit-to-stand desk and four touchscreen computer monitors accounted for another good chunk of expenses and I paid Tim Sykes a bunch of money in 2008 too.
The vast majority of my trading activity up until May took place in my individual IB account, since closed. See all my 2008 activity in this account. I opened a new account (that I currently use) at IB that was my primary trading account for the rest of the year.
Schedule D short-term gains: $84,992
Add back trading gains transferred to Schedule C: $15,178
Add back short-term losses on Prosper.com loans: $201
Gross trading profits: $100,371
Trading expenses: $15,178
Net trading profit: $85,193
Again, approximately half my trading expenses were due to interest, most of which was from a loan from a family member to fund my trading accounts.
In 2010 I elected to become a mark-to-market trader; consequently my trading gains are now filed on Form 4797, not Schedule D.
Form 4797 gross trading gains: $87,871
Subtract gain on Section 197 expensed trading DVD: $156
Add back trading gains transferred to Schedule C: $3,680
Add Broadstreet trading gains: $6,280
Gross trading profits: $97,675
Trading expenses: $9,960
Net trading profit: $87,715
I have not received 1099 forms yet. Preliminary data downloaded from my brokers and analyzed by Tradelog is provided below but it has not been verified / double checked.
Interactive Brokers: $67,823 gross profit (net of $10,094 in commissions; $2,901,330 in sales and $2,833,507 in purchases)
SpeedTrader: $86,212 gross profit (net of $13,153 in commissions; $4,120,830 in sales and $4,037,953 in purchases)
Capstone: $196 gross profit (net of $142 in commissions; $12,797 in sales and $12,601 in purchases)
Gross profit $154,231
I will update this post after I have received my 1099 forms.