Stock & Day Trader CPA Columbus Ohio
Focus on profitable stock market trades and growing your portfolio. We help professional investors manage tax implications of trading.
Stock Trader CPA Services
Investing in the financial markets is a full-time job for thousands of financial professionals and stock traders. The sheer amount of information, economic understanding and planning required to consistently execute profitable trades can leave you with very few hours to focus on other financial aspects like the tax implications of each and every trade.
While you’ve probably factored in taxes as part of the trading plan process, we can help you record transactions in your bookkeeping, accurately measure profits and losses accounting for trading or other brokerage fees, and help you avoid potential unknown tax consequences.
- Timely handling of your entire accounting process, from setting up a chart of accounts to managing investment records and expenses.
- While trading platforms often provide their own reporting, we integrate with QuickBooks to track every single transaction, keeping you informed with accurate data to facilitate strategic choices
- Day traders and everyday investors by definition have different tax implications. We help you identify tax deductions appropriate to how you operate or can recommend changes in trading strategy. Sometimes it makes sense to delay short-term to long-term capital gains to save you thousands in taxes because of a lower tax rate for a longer term investment.
Managing your Day Trading finances with Hogan CPA, a QuickBooks ProAdvisor
As someone who manages capital, we’re sure you’re very good with numbers. Trading platforms like E-Trade, TD Ameritrade, Fidelity, and others provide digital records of your trades with varying reporting per platform. We utilize QuickBooks technology to help make transaction importing smoother and to help you better understand your revenue, trading fees, purchasing of tools or charting, and taxes.
2. Why Choose a CPA Specializing in Stock/Day Trading
Accounting for stock traders requires specialized knowledge and expertise to accurately track, measure, and report the company’s financial performance. The unique characteristics of stock traders and the financial industry make for more convoluted accounting than other businesses, which is why you should seek the expertise of a specialist.
In-depth knowledge of Tax Rules
A day trading tax accountant will specialize in tax rules and regulations that apply to stock traders, understanding the tax liabilities you face and how to optimize your tax planning better. We stay up-to-date on regulations that affect our client’s taxes and break them into a simple language you can understand.
Regular Communication and Recommendations
Our highest priority is the exceptional service we deliver to our clients. We meet regularly with clients to discuss strategies and how they are making progress to better optimize for taxes. We provide regular advice based on bookkeeping records or goals our clients are trying to achieve. This may be actions to take now or delay for the future.
Handling Financial Statements
Earnings through stock and day trading can generate a lot of data. This data needs proper analysis to help you understand the figures better. We’re here to prepare the financial analysis and statements on your behalf to allow you more time planning your next successful trade.
3. Stock Trader Tax Planning and Management
Accounting and tax planning correctly for stock purchases or sales aren’t exactly straightforward. You may have:
- cash or brokerage accounts with varying balances
- securities purchased that are in the market
- dividends or interest income being paid to you
- brokerage, trading, or other regulator fees
- realized gains or losses categorized as short-term or long-term capital gains/losses
- unrealized gains or losses on equities not yet sold
- taxable and non-taxable income
- and more
All of the above need to be taken into consideration in the accounting process and long-term planning for taxes and deductions.
Selecting the correct Elections
Day traders can specifically elect to be considered “traders in securities” by selecting the Sec. 475(f) mark-to-market election on their taxes. While making this election is a critical component, your actions also determine whether you’re a trader versus an investor as well. Among other factors, the time spent, holding periods, frequency and dollar amounts, and how substantial trading is to your overall income are factored into whether the IRS considers you to be a “trader in securities” or not.
Wash-sale Rules
Another type of tax implication can be a rule that disallows the deduction of losses, called the “wash sale” rule. Essentially, if a sale of stocks results in a loss and the purchase of another nearly “identical stock” happens within a 30 day period, the loss that was incurred cannot be a loss deduction. The rules are a little more specific with a few scenarios that can apply, but that is the gist of Sec. 1091 that will be taken into account for a stock trader making frequent purchases and sales of stocks. IRS Form 8949 will need to be filled out with each trade related to wash-sale adjustments which will also flow into your Schedule D for capital gains and losses.
Tax-Loss Harvesting
On the opposite side of “wash-sales” are tax-loss harvesting strategies. These typically apply to non-professional investors with brokerages accounts (non-retirement) that are trading infrequently. These rules allow capital losses from the sale of a stock to offset capital gains or increases in ordinary income, reducing your tax burden. Again, the details of the rule are more complicated than our simplistic explanation, but this strategy can be taken into account as a way to offset tax loss with the help of a stock trading CPA.
Brokerage Accounts vs Retirement Accounts
Day traders are typically using brokerage accounts to perform specific trades in which they can easily move money between their different accounts and their bank to pay business or personal bills. While traders are typically savvy enough to understand the implications, we occasionally make recommendations to help traders save money by completing certain trades in retirement accounts instead of their brokerage account, delaying or completely eliminating that tax implication like a ROTH account, although the obvious delay in access to said capital.
Stock and Day Trader Accounting Services with Hogan CPA
Hogan CPA allows you to focus on your expertise to improve your portfolio of investments. Our service ensures your accounting and finances are in good standing with the IRS, we ensure estimated tax payments are made on time, and help you plan for taxes with the appropriate tax deductions.
Below are the services you will get from Hogan CPA.
Accounting and Tax Preparation
Stock traders might not understand the implications of their trades and how they affect taxes on their earnings. This service includes bookkeeping and tax preparations, a vital service to keep you in good standing with the law.
Business Entity Selection
As an individual trader or investment company, we can help you identify the appropriate business entity or change to one that is more advantageous to your company. Various taxes are levied on entities rather than an individual and in many cases, incurring some personal taxes can offset those to your business, allowing you to be more profitable and lower your taxable income.
Qualifying for Trader Tax Status or other Tax Exemptions
We can help you determine whether your current trading activity is defined as a “trader” per the IRS code and can help you determine if there are other exemptions available in your current investing state. We’ll also keep you informed law changes that are relevant to you, like recent updates to long-term capital gains taxes and more.
Stock and Day Trader Accounting Services with Hogan CPA
Hogan CPA allows you to focus on your expertise to improve your portfolio of investments. Our service ensures your accounting and finances are in good standing with the IRS, we ensure estimated tax payments are made on time, and help you plan for taxes with the appropriate tax deductions.
Below are the services you will get from Hogan CPA.
Accounting and Tax Preparation
Stock traders might not understand the implications of their trades and how they affect taxes on their earnings. This service includes bookkeeping and tax preparations, a vital service to keep you in good standing with the law.
Business Entity Selection
As an individual trader or investment company, we can help you identify the appropriate business entity or change to one that is more advantageous to your company. Various taxes are levied on entities rather than an individual and in many cases, incurring some personal taxes can offset those to your business, allowing you to be more profitable and lower your taxable income.
Qualifying for Trader Tax Status or other Tax Exemptions
We can help you determine whether your current trading activity is defined as a “trader” per the IRS code and can help you determine if there are other exemptions available in your current investing state. We’ll also keep you informed law changes that are relevant to you, like recent updates to long-term capital gains taxes and more.
How we help Stock Market Traders
Let us help you strategize for taxes and free up your time by taking repetitive tasks like bookkeeping off your plate.
What our trading clients are saying
Tax Accountant CPA for Stock Marker traders
Schedule an appointment with Hogan CPA Financial Services
For A Complimentary Phone Consultation
Growing and expanding your stock or day trading portfolio is only possible if you have time. We have an easy consultation process where we can discuss any questions you might have about our accounting or tax services. Simply fill out the appointment request form or give us a call to discuss.
See our Frequently Asked Questions below for commonly asked questions about our stock/day trader CPA services.
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Stock Market and Day Trading CPA FAQs
What tax considerations should traders know about?
Traders should look at capital gains tax rates, deductions, and wash sale rules discussed above.
Additionally, mark-to-market accounting can be used to provide current values of assets on a companies balance sheet. This will give investors a better understanding of the value of a portfolio now rather than what they paid. If the current value is more or less than the original investment, this can indicate it’s a good time to buy or sell an asset. In addition, this information can be valuable in relation to other assets or contracts which may cause you to force-liquidate assets to cover another position, for example, if you are options trading.
Do you have year-round support?
Yes. Hogan CPA does not just work during tax season but throughout the year or on an as-needed basis. We understand trading activities happen throughout the year and we have to be available to provide guidance whenever necessary. We work with your team and adapt to the agreement whether that’s on a monthly, quarterly, or other basis. A simple call or email and we can set up an appropriate time to talk when both parties are available.
How will a day trader CPA help with auditing risks?
Hogan CPA can help in maintaining proper records and documentation while understanding “what is normal” in your industry and what might be a red flag to the IRS. This helps to reduce the chances of tax audits and increases the accuracy of your reporting, making you more confident in your decision-making.