80,000 New IRS Agents…for What?

Tucked inside the new government legislation is funding which will be supported by the work of 80,000 new IRS agents. Yes, 80,000! Just what will they be doing? Rubberstamping tax deductions from 1040 filings and sending out refunds? I don’t think so.

The plan is to collect some 400 billion from taxpayers over the next decade assisted by these new agents. If your tax ducks aren’t in row already, now is the time to get them there. Yes, trading is a new profession, and the rules are new and evolving. Not knowing them and applying them correctly is inexcusable in the government’s eyes. Lets face it: The agents are being tasked to bring in a boatload of cash to pay for every wish list in the new legislation.

In The Disciplined Trader, author Mark Douglas said it best, “I urge you to run your trading as a business. You’re here to do a job…and the result of doing a good job is maximizing your profit.” Business structure forces you to become profitable or die. Why anyone would trade outside a business model today is ludicrous.

Elevate yourself by taking legal deductions in a business so you can maximize your profit. These new IRS agents will be searching for traders trying to take losses outside of a business structure. The tax courts are full of cases of ordinary traders attempting to take losses on trades outside a business. I review at least a dozen cases in Chapter 2 of my book, The Business of Trading. Had these traders taken the time (and it doesn’t take much) to structure and set up a new business around their trading activities in advance, their deductions would have been allowed, and they wouldn’t have ended up in tax court.

There has never been a better time to be a trader. Most likely, you are going to be doing this for a long time to come. If your vision for trading is beyond a few years, now is the time. Opportunities are everywhere!

You can’t live an abundant life in fear. Don’t let another trading day go by without getting yourself started in a new business structured around your trading. While maximizing your trade take-home profit is the ultimate goal, keeping the agents off your back is just another reason to start your business today. You will be glad you did.