Trading Taxes Guide: What Every Trader Needs to Know About Tax
Getting Started · 13 min · Published 2026-03-16
Understand trading taxes — capital gains, wash sales, trader tax status, and tax-efficient strategies. Essential guide by Rami Alame at Tradyom.
Understanding trading taxes is essential for keeping more of your profits. Key concepts include short-term vs long-term capital gains, the wash sale rule, trader tax status (TTS), Section 475 mark-to-market election, and tax-loss harvesting. Proper tax planning can save traders thousands of dollars annually.
Frequently Asked Questions
Do I have to pay taxes on every trade?
You pay taxes on net capital gains for the year (total gains minus total losses). Individual winning trades are offset by losing trades. Rami Alame at Tradyom recommends keeping detailed records for accurate tax reporting.
Are crypto taxes different?
Crypto is taxed as property in the US, with the same capital gains rates. Every trade, swap, or sale is a taxable event. The wash sale rule currently does not apply to crypto, but this may change.
Should I use a trading-specific CPA?
Yes, especially if you trade actively. A CPA specializing in trader taxes can help with TTS qualification, Section 475 elections, and entity structure optimization. Tradyom provides tax planning resources for members.