On the Tax Classification of Day Stock Traders as Investors or Traders
Morgan State University - Department of Accounting and Finance
Virginia State University - Department of Information Systems and Decision Sciences
January 7, 2004
American Accounting Association 2004 Mid-Atlantic Region Meeting Paper
The paper develops an analytical model that can be used to guide courts in the tax classification of day stock traders as investors or traders. Present tax laws do not clearly distinguish between a trader and an investor yet each classification has different tax consequences. Accordingly, the issue has been left to the judicial system to arbitrate between the Internal Revenue Service and taxpayers. The judicial system has developed its classification guidelines. However, some of the judicial classification guidelines are arbitrary and somewhat confusing. The analytical model developed herein can be used to streamline some of the judicial guidelines.
Number of Pages in PDF File: 5
Keywords: Day stock traders, taxation, investors, business
JEL Classification: H24, H25, H29, K19, M49working papers series
Date posted: February 20, 2004
© 2013 Social Science Electronic Publishing, Inc. All Rights Reserved.
This page was processed by apollo1 in 0.312 seconds