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I had a friend that dabbled in the day trading market for a year.
He put in about $10,000. On some days he made money, on others he lost money. After a year he pulled about $25,000 out and figured it was something millionaires can have fun with, but not enough money to be made for the average Joe.
He only claimed the $15,000 because he tried doing his own taxes. I told him he should go to a tax guy that year and pay the $70 to have it done right.
IRS sends him a notice saying he needs to pay the other taxes on $300,000 in income. Haha...
He didn't show them correctly that he made $300,000, but lost $275,000 and that $10,000 was the initial investment.
Took him 2 years and an audit before it got straightened out. That was under Bush.
Had another friend do the same thing with being a semi-pro poker player. Only this time under Obama he was able to meet with a local IRS agent, show him his playing logs and the receipts from the Casinos on cashing in/out each session and just like that he is excused.
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