How many CPAs have ever seen a tax return with 3,500 trades on Schedule D? In this escalating time of the "day-traders," more and more accounting professionals may one day be faced with a similar situation.
David Goehl is a 31-year-old, self-employed lawyer, who traded 3,500 times in 1999 for a net profit of $85,000, which averages to trades worth about $1,000 per day after taxes, commissions, rent on the apartment where he performs the trades and even a portion of his cable service.
Schedule D is often difficult for any tax preparer given a small number of trades, let alone 3,500. Although Goehl does all this using a spreadsheet to track the trades and compute profits/losses, he admits that keeping up the taxes is maddening.
The advice he gives is to keep up wtih recordkeeping on a weekly basis to save a tremendous amount of time later.