query: Tax: 1099 paper form

positive: You can print them on any IRS-approved paper, you don't have to use pre-printed forms. The IRS publishes specifications for paper that is approved for use for these kinds of forms (109*, W*, etc).  Here's the reason why it is important: Even the slightest deviation can result in incorrect scanning, and may affect money amounts reported for employees. Note that some portions of these forms are in different color (1099-MISC copy A). This is important, and using incorrect color will affect the IRS OCR mechanisms. Forms for individuals are less complicated with regards to technical specifications, because individuals must file them, and as such any complication will unnecessarily burden the citizenry. All the 109*, W* etc forms are not legally required to be filed by all citizens. You're only required to file them if you chose to do business, or chose to employ others. As such, using professional software and special forms is a cost of doing your business, and not a tax as it would be had it been mandatory to everyone. Mistakes in individual forms due to OCR failure or something else will be noticed by the taxpayers (less/more refund, etc) or through the internal matching and cross-check. However, forms 109* and W* feed that matching and cross-check system and are considered source of truth by it, and as such their processing must be much more reliable and precise.

negative: When you invest (say $1000) in (say 100 shares) of a mutual fund at $10 per share, and the price of the shares changes,  you do not have a capital gain or loss, and you do not have to declare anything to the IRS or make any entry on any line on Form 1040 or tell anyone else about it either. You can brag about it at parties if the share price has gone up, or weep bitter tears into your cocktail if the price has gone down, but the IRS not only does not care, but it will not let you deduct the paper loss or pay taxes on the paper gain.  What you put down on Form 1040 Schedules B   and D is precisely what the mutual fund will tell you on   Form 1099-DIV (and Form 1099-B), no more, no less. If you did not report any of these amounts on your previous   tax returns, you need to file amended tax returns, both   Federal as well as State, A stock mutual fund invests in stocks and the fund manager may buy and sell some stocks during the course of the year. If he makes a profit, that money will be distributed to the share holders of the mutual fund. That money can be re-invested in more shares of the same mutual fund or taken as cash  (and possibly invested in some other fund). This  capital gain distribution is reported to you on Form 1099-DIV and you have to report sit on your tax return even if you re-invested in more share of the same mutual fund, and the amount of the distribution is taxable income to you. Similarly, if the stocks owned by the mutual fund pay dividends, those will be passed on to you as a dividend distribution and all the above still applies. You can choose to reinvest, etc, the amount will be reported to you on Form 1099-DIV, and you need to report it to the IRS and include it in your taxable income. If the mutual fund manager loses money in the buying and selling he will not tell you that he lost money but it will be visible as a reduction in the price of the shares. The loss will not be reported to you on Form 1099-DIV and you cannot do anything about it.  Especially important, you cannot declare to the IRS that you have a loss and you cannot deduct the loss on your income tax returns that year. When you finally sell your shares in the mutual fund, you will have a gain or loss that you can pay taxes on or deduct. Say the mutual fund paid a dividend of $33 one year and you re-invested the money into the mutual fund, buying 3 shares at the then cost of $11 per share. You declare the $33 on your tax return that year and pay taxes on it. Two years later, you sell all 103 shares that you own for $10.50 per share.  Your total investment was $1000 + $33 = $1033. You get $1081.50 from the fund, and you will owe taxes on $1081.50 - $1033 = $48.50. You have a profit of $50 on the 100 shares originally bought and a loss of $1.50 on the 3 shares bought for $11: the net result is a gain of $48.50. You do not pay taxes on $81.50 as the profit from your original $1000 investment; you pay taxes only on $48.50 (remember that you already paid taxes on the $33). The mutual fund will report on Form 1099-B that you sold 103 shares for $1081.50 and that you bought the 103 shares for  an average price of $1033/103 = $10.029 per share. The difference is taxable income to you. If you sell the 103 shares for $9 per share (say),   then you get $927 out of an investment of $1033 for   a capital loss of $106. This will be reported to you   on Form 1099-B and you will enter the amounts on   Schedule D of Form 1040 as a capital loss. What you actually pay taxes on is the net capital gain, if any, after combining all your capital gains and losses for the year. If the net is a loss, you can deduct up to $3000 in a year, and carry the rest  forward to later years to offset capital gains in later years. But, your unrealized capital gains or losses (those that occur because the mutual fund share price goes up and down like a yoyo while you grin or grit your teeth and hang on to your shares) are not reported or deducted or taxed anywhere. It is more complicated when you don't sell all the shares you own in the mutual fund or if you sell shares within one year of buying them, but let's stick to simple cases.

negative: Assuming that the jobs where you've earned money from have sent you W-2s, 1099s, etc. Then yes, you can request a Wage and Income Transcript: Shows data from information returns we receive such as Forms W-2,   1099, 1098 and Form 5498, IRA Contribution Information. Current tax   year information may not be complete until July. This transcript is   available for up to 10 prior years using Get Transcript Online or Form   4506-T.

negative: I'm not sure 1099-MISC is what you should expect. Equity means ownership, and in LLC context it means membership. As an LLC member, you'll get distributions and should receive a K-1 form for tax treatment, not 1099 or W2. If the CEO is talking about 1099 it means he's going to hire you as a contractor which contradicts the statement about equity allocation. That's an entirely different situation. 1) Specifically, would the 1099-MISC form be used in this case? 1099-MISC is used to describe various payments. Depending on which box is filled, the tax treatment may be as of employment income (subject to SE taxes) or passive income (royalties, rents, etc - subject to various limitations in the tax code). 3) If this is the only logical method of compensation (receiving a % of real estate sales), how would it be taxed? That would probably be a commission and taxed as employment income. I suggest to get a professional tax adviser consultation on this issue, with specific details, numbers, and kinds of deals involved. You can get gain or lose a lot of money just because you're characterized as a contractor and not LLC member or employee (each has its own benefits and disadvantages, and you have to consider them all). 4) Are there any advantages/disadvantages to acquiring and selling   properties through the company as opposed to receiving a % of sales? Yes. There are advantages and there are disadvantages. For example, if you're using a corporation, you can get salary, if you're a contractor you cannot. There are a lot of issues hidden in this distinction (which I've just discussed with KeithS in this argument).

negative: For reporting purposes, most IRA firms prefer that you roll the 401(k) funds into a Rollover or Traditional IRA and then convert to the ROTH from there. The mid-air conversions (401(k) directly into a ROTH) can get tricky when you go to do your taxes the following year if the 1099 form from the releasing custodian and the 5498 form from the accepting custodian have different numbers due to the conversion amount and taxes withheld if any.

negative: "If you receive a 1099-MISC from YouTube, that tells you what they stated to the IRS and leads into most tax preparation software guided interviews or wizards as a topic for you to enter.  Whether or not you have a 1099-MISC, this discussion from the IRS is pertinent to your question. You could probably elect to report the income as a royalty on your copyrighted work of art on Schedule E, but see this note: ""In most cases you report royalties in Part I of Schedule E (Form 1040). However, if you ... are in business as a self-employed writer, inventor, artist, etc., report your income and expenses on Schedule C or Schedule C-EZ (Form 1040)."" Whether reporting on Schedule E or C is more correct or better for your specific circumstances is beyond the advice you should take from strangers on the internet based on a general question - however, know that there are potentially several paths for you.   Note that this is revenue from a business, so if you paid for equipment or services that are 100% dedicated to your YouTubing (PC, webcam, upgraded broadband, video editing software, vehicle miles to a shoot, props, etc.) then these are a combination of depreciable capital investments and expenses you can report against the income, reducing the taxes you may owe.  If the equipment/services are used for business and personal use, there are further guidelines from the IRS as to estimating the split. These apply whether you report on Sch. E, Sch. C, or Sch C-EZ.    Quote: ""Self-Employment Income It is a common misconception that if a taxpayer does not receive a Form 1099-MISC or if the income is under $600 per payer, the income is not taxable. There is no minimum amount that a taxpayer may exclude from gross income. All income earned through the taxpayer’s business, as an independent contractor or from informal side jobs is self-employment income, which is fully taxable and must be reported on Form 1040. Use Form 1040, Schedule C, Profit or Loss from Business, or Form 1040, Schedule C-EZ, Net Profit from Business (Sole Proprietorship) to report income and expenses. Taxpayers will also need to prepare Form 1040 Schedule SE for self-employment taxes if the net profit exceeds $400 for a year. Do not report this income on Form 1040 Line 21 as Other Income. Independent contractors must report all income as taxable, even if it is less than $600. Even if the client does not issue a Form 1099-MISC, the income, whatever the amount, is still reportable by the taxpayer. Fees received for babysitting, housecleaning and lawn cutting are all examples of taxable income, even if each client paid less than $600 for the year. Someone who repairs computers in his or her spare time needs to report all monies earned as self-employment income even if no one person paid more than $600 for repairs."""

negative: Assuming a USA taxable account: Withdrawing funds from a brokerage account has nothing to do with taxes. Taxes are owed on the profit when you sell a stock, no matter what you do with the funds. Taxes are owed on any dividends the stock produces, no matter what you do with the dividend. The brokerage sends you a form 1099 each year that shows the amounts of dividends and profits. You have to figure out the taxes from that.

negative: The company that's apparently going to pay this rent wants to treat it as a business expense.  They are asking for your SSN because they expect to issue a 1099-MISC. (They probably gave you a Form W-9? It's not mandatory but it's common to request a taxpayer ID on this form.) There are a couple of issues at play here:

negative: Form 8288 is to report to the IRS withholding of capital gains tax that may be due from the seller. Foreign nationals don't always file tax returns, so they often didn't pay capital gains tax on properties that they sold. Congress decided to make the buyers responsible for this tax so that they would have a better chance of collecting it. There is a penalty against the buyer if that tax is not withheld. Your attorney should have filed this form on your behalf as part of the closing papers. I think your first step is to look at your copy of the closing papers and see if money was withheld from the sale. There definitely should be disclosure of these requirements before the sale. You should also follow up with your attorney to see whether he has already filed the forms 8288 and 8288-A on your behalf. If you had purchased for less than $300,000 (and were purchasing for your primary residence), you would not have to file that form, but since the property was under $1,000,000 the withholding rate is only 10% (rather than 15%).

negative: Careful.  I would personally need a LOT more than $5 more per hour to go from W-2 employment to 1099 employment.  It boils down to two reasons: (1) employers pay a huge amount of taxes on behalf of their employees, and (2) you would have to pay all of your own withholding up front. Your current proposal from them doesn't account for that. There are also risks that you face as a 1099.  On the first item, your employer currently pays 6.2% of your Social Security tax. You pay the other 6.2%. If you go to 1099 status, you will be self-employed as an independent contractor and have to pay the full 12.4% out of your increased 1099 wages.  On the second item, your employer also does your withholding out of your paychecks based on what you tell them on a form W-4. If you're disciplined enough to pay this out yourself in estimated taxes every time you get a paycheck, great. Many people aren't and just see a much bigger paycheck with no taxes out of it, and end up with a large tax bill at the end of the year.  Overall, there are some other considerations like healthcare and other benefits. These will not be available to you as a 1099 employee. You can also be terminated spontaneously, unless you have a specific contract length with the company.  As I see it, not including any benefits you would receive, you're looking at LESS money in your pocket at $50/hr as a contractor than at your $48/hr. Your pay net social security deductions is: $48 x 40 hrs x 52 weeks = 99,840 * .938 = 93,649.92. As a 1099 @ $50/hr you would net $50 x 40 hrs x 52 weeks = 104,000 * .876 = 91,104.  Then there are the rest of taxes, etc to figure out your real take-home pay.  I'm not a tax advisor, but I would be very careful to get the whole picture figured out before jumping. I would ask for a lot more with the added risk you would take as an independent, too.

negative: This is a complicated question that relies on the US-India Tax Treaty to determine whether the income is taxable to the US or to India.  The relevant provision is likely Article 15 on Personal Services. http://www.irs.gov/pub/irs-trty/india.pdf It seems plausible that your business is personal services, but that's a fact-driven question based on your business model.  If the online training is 'personal services' provided by you from India, then it is likely foreign source income under the treaty.  The 'fixed base' and '90 days' provisions in Article 15 would not apply to an India resident working solely outside the US. The question is whether your US LLC was a US taxpayer.  If the LLC was a taxpayer, then it has an obligation to pay US tax on any worldwide income and it also arguably disqualifies you from Article 15 (which applies to individuals and firms of individuals, but not companies).  If you were the sole owner of the US LLC, and you did not make a Form 8832 election to be treated as subject to entity taxation, then the LLC was a disregarded entity.  If you had other owners, and did not make an election, then you are a partnership and I suspect but cannot conclude that the treaty analysis is still valid. So this is fact-dependent, but you may be exempt from US tax under the tax treaty.  However, you may have still had an obligation to file Forms 1099 for your worker.  You can also late-file Forms 1099 reporting the nonemployee compensation paid to your worker.  Note that this may have tax consequences on the worker if the worker failed to report the income in those years.

negative: Yes, it should come out tax free. However you should have reported it  to the IRS at the time (currently it is done on form 8606). If you haven't done it, the IRS may disagree with you on that and require taxes. If you have proper documentation of the contribution, then when you withdraw from your IRA - you use that same form 8606 to calculate the non-taxable portion. Note that you cannot just take $2K out of the 1099-R, the non-taxable portion will be prorated through all of your IRA withdrawals. Also, keep in mind that only the actual after tax portion will be tax-free, the gains will be taxable. I.e.: if you deposited $2K after tax (and nothing else), and they have now grown to $100K - you will only have 2% of your distribution tax free (2k/100K * distributed amount).

negative: As the owner of the S-corp, it is far easier for you to move money in/out of the company as contributions and distributions rather than making loans to the company. Loans require interest payments, 1099-INT forms, and have tax consequences, whereas the distributions don't need to be reported because you pay taxes on net profits regardless of whether the money was distributed. If you were paid interest, disregard this answer. I don't know if or how you could re-categorize the loan once there's a 1099-INT involved. If no interest was ever paid, you just need to account for it properly: If the company didn't pay you any interest and never issued you a 1099-INT form (i.e. you wrote a check to the company, no promissory note, no tax forms, no payments, no interest, etc.) then you can categorize that money as a capital contribution. You can likewise take that money back out of the company as a capital distribution and neither of these events are taxable nor do they need to be reported to the IRS. In Quickbooks, create the following Equity accounts -- one for each shareholder making capital contributions and distributions: When putting money into the company, deposit into your corporate bank account and use the Capital Contribution equity account. When taking money out of the company, write yourself a check and use the Distributions account. At the end of every tax year, you can close out your Contributions and Distributions to Retained Earnings by making a general journal entry. For example, debit retained earnings and credit distributions on Dec 31 every year to zero-out the distributions account. For contributions, do the reverse and credit retained earnings. There are other ways of recording these transactions -- for example I think some people just use a Member Capital equity account instead of separate accounts for contributions and distributions -- and QB might warn you about posting journal entries to the special Retained Earnings account at the end of the year. In any case, this is how my CPA set up my books and it's been working well enough for many years. Still, never a bad idea to get a second opinion from your CPA. Be sure to pay yourself a reasonable salary, you can't get out of payroll taxes and just distribute profits -- that's a big red flag that can trigger an audit. If you're simply distributing back the money you already put into the company, that should be fine.

negative: "I have done similar software work. You do not need an LLC to write off business expenses. The income and expenses go on Schedule C of your tax return. It is easy to write off even small expenses such as travel - if you keep records. The income should be reported to you on a 1099 form, filled out by your client, not yourself.  For a financial advisor you should find one you can visit with personally and who operates as a ""fee-only"" advisor. That means they will not try to sell you something that they get a commission on. You might pay a few $hundred per visit. There are taxes that you have to pay (around 15%) due to self-employment income. These taxes are due 4 times a year and paid with an ""estimated tax"" form. See the IRS web site, and in particular schedule SE. Get yourself educated about this fast and make the estimated tax payments on time so you won't run into penalties at the end of the year."

negative: "Even if your employer decides not to include the HSA contributions in Box 12, the IRS will still be informed how much went into your HSA when the form 5498-SA gets filed. So you don't need to worry about the IRS; they'll get the information they want.  As for you, if you already know how much the ""employer contributions"" (both what the employer contributed and what you contributed through payroll deduction) were, and you know how much you contributed directly, then once you get your form 1099-SA you'll have all the information you need to complete your tax return."

negative: An amended return is required for situations that impact tax owed, or your tax refund. 8606 purpose is to track non-deducted IRA deposits. I'd recommend you gather all your returns to form a paper trail, and when filing your 2016 return, show a proper 8606 as if you'd tracked it all along.

negative: The IRA contribution for the year are allowed until the tax day of that year. I.e.: you can contribute for 2015 until April 15th, 2016 (or whatever the first business day is after that, if the 15th is a holiday). You'll have to explicitly designate your contribution for 2015, since some of the IRA providers may automatically designate the current year unless you explicitly say otherwise. If that happens - it will be very hard to fix later, so pay attention when you're making the contribution. You get a couple of things from your IRA provider: Form 5498 - details your contributions for the year, account FMV, and RMD details. You can see the actual form here. You don't always get this form, if you didn't contribute anything and no RMD is required for you. Since the last day to contribute is April 15th, these forms are usually being sent out around mid-May. But you should know how much you've contributed by the tax day without it, obviously, so this is only for the IRS matching and your record-tracking.  Form 1099-R includes information about distributions (including withdrawals and roll-overs). You may not get this form if you didn't take any money out of your IRA. These come out around end of January.

negative: Shares used to be paper documents, but these days they are more commonly held electronically instead, although this partly depends on what country you're in. But it doesn't make any significant practical difference. Regardless of their physical form, a share simply signifies that you own a certain proportion of a company, and are thus entitled to receive any dividends that may be paid to the shareholders. To sell your shares, you need a broker -- there are scores of online ones who will sell them for a modest fee. Your tax forms are entirely dependent on the jurisdiction(s) that tax you, and since you've not told us where you are, no one can answer that.

negative: "I disagree with the other respondents. If your tenant is an individual, renting in their individual capacity, there is no reason they need your SSN. They will not be sending a 1099 to you. If your tenant is a business, then your property is not a residential property. It is at least a ""corporate housing"", and you would have noticed that the contract was signed by a company representative in the capacity of being a company representative, not an individual person. In that case, that representative would also ask  you to fill a form W9, on which your tax ID should be reported. I would suggest let the tenant figure out their tax avoidance issues without you being involved."

negative: I don't think so in your case. Unless the account generates so much interest income that it became reportable (I don't know the exact limit, but I think it's in the hundreds if not thousands of dollars, you might get a 1099 form if it generates over $10 of interest income, but you don't have to file taxes if your overall income is too low anyways). The US does not typically tax assets, only income. There are some states (Florida is the only one I can think of) that has odd tax treatment of intangible assets, but I doubt that would apply in your case. If this were a large enough amount, usually over $10,000, it might trigger some reporting requirements (possibly by your home country).

negative: At the end of each calendar year the mutual fund company will send you a 1099 form. It will tell you and the IRS what your account earned. You will see boxes for: You will end up paying taxes on these, unless the fund is part of a 401K or IRA. These taxes will be due even if you never sold any shares. They are due even if it was a bad year and the value of your account went down. Most if not all states will levy an income tax yon your dividends and capital gains each year. When you sell your shares you may also owe income taxes if you made a profit. The actual taxes due is a more complex calculation due to long term vs short term, and what other gains or losses you have. Partial sales also take into account which shares are sold.

negative: "Congratulations on getting married!  As far as the IRS is concerned, you are a married couple for all of this year for tax purposes. The 2014 HSA contribution limit for you and your husband together is $6550.  This limit applies to both of you together, whether you file jointly or separately.  So it looks like you and your husband have excess contributions this year.  You'll need to withdraw some contributions, either in your account or your husband's account, to get under $6550 total for the year. If you choose to take this money out of your account, since you have already spent this money out of your HSA, you won't actually receive a check from the withdrawal.  Instead, the money that you have already spent will be recategorized from a normal HSA medical distribution to an excess contribution withdrawal.  When you get your 1099-SA form from your HSA bank at tax time, the distributions will be coded as excess contributions distributions.  In addition, the form will include the amount of any earnings (interest) that you received on your excess contributions. At tax time, you'll need to examine your W-2 form from your employer closely.  If the form does not include the amount that the employer HSA contribution in your taxable income, you'll need to add this amount as ""Other income"" on your taxes.  You'll also need to include any earnings on the excess contributions reported on the 1099-SA. Since your husband funds his own HSA and doesn't have any employer contributions to it, you might find it easier to withdraw the excess contributions from his HSA instead of yours.  To do this, you need to tell his HSA bank that the withdrawal is an excess contribution withdrawal so that it gets reported correctly on his 1099-SA.  There won't be any changes to his W-2, and the only ""other income"" he'll need to report is any earnings on the excess contributions from his 1099-SA. The instructions for Form 8889, line 13 explain what to do in the event of an excess contribution (note: The text here is from the 2013 version of the instructions): Line 13 If you or someone on your behalf (or your employer) contributed more to your HSA than is allowable, you may have to pay an additional tax on the excess contributions. Figure the excess contributions using the following instructions. See Form 5329, Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts, to figure the additional tax. Excess Contributions You Make To figure your excess contributions (including those made on your behalf), subtract your deductible contributions (line 13) from your actual contributions (line 2). However, you can withdraw some or all of your excess contributions for 2013 and they will be treated as if they had not been contributed if: You make the withdrawal by the due date, including extensions, of your 2013 tax return (but see the Note under Excess Employer Contributions, later), You do not claim a deduction for the amount of the withdrawn contributions, and You also withdraw any income earned on the withdrawn contributions and include the earnings in “Other income” on your tax return for the year you withdraw the contributions and earnings. Excess Employer Contributions Excess employer contributions are the excess, if any, of your employer's contributions over your limitation on line 8. If you made a qualified HSA funding distribution (line 10) during the tax year, reduce your limitation (line 8) by that distribution before you determine whether you have excess employer contributions. If the excess was not included in income on Form W-2, you must report it as “Other income” on your tax return. However, you can withdraw some or all of the excess employer contributions for 2013 and they will be treated as if they had not been contributed if: You make the withdrawal by the due date, including extensions, of your 2013 tax return (but see the following Note), You do not claim an exclusion from income for the amount of the withdrawn contributions, and You also withdraw any income earned on the withdrawn contributions and include the earnings in “Other income” on your tax return for the year you withdraw the contributions and earnings. There are further instructions on what to do if you don't take care of this until a future year, but it is much better and easier if you take care of this before the end of this year, and handle it correctly on your tax return. I believe that this is how it will all work; however, you'll want to confirm all of this with someone who knows what they are talking about and can look at your individual situation.  Hopefully, this answer gives you enough information to be able to ask the right questions."

negative: You can sign over the check, of course. However, you'll probably need to deal with 1099 issued to you personally instead of the corporation later on. You'll have to add it to your tax return as income and negative income on the same line (line 21 of your 1040) and attach a statement explaining that the income was erroneously reported to you and will be reported on the corp form 1120. Another option is to return the check to the payer and ask them to reissue in the correct name. Next time, make sure to provide the properly filled W9 to your payers with the details of the corporation, not your own details.

negative: "My number one piece of advice is to see a tax professional who can guide you through the process, especially if you're new to the process. Second, keep detailed records. That being said, I found two articles, [1] and [2] that give some relevant details that you might find helpful. The articles state that: Many artists end up with a combination of income types: income from   regular wages and income from self-employment. Income from wages   involves a regular paycheck with all appropriate taxes, social   security, and Medicare withheld. Income from self-employment may be in   the form of cash, check, or goods, with no withholding of any   kind. They provide a breakdown for expenses and deductions based on the type of income you receive.  If you get a regular paycheck: If you've got a gig lasting more than   a few weeks, chances are you will get paid regular wages with all   taxes withheld. At the end of the year, your employer will issue you a   form W-2. If this regular paycheck is for entertainment-related work   (and not just for waiting tables to keep the rent paid), you will   deduct related expenses on a Schedule A, under ""Unreimbursed Employee   business expenses,"" or on Form 2106, which will give you a total to   carry to the schedule A. The type of expenses that go here are: If you are considered an independent contractor (I presume this includes the value of goods, based on the first quoted paragraph above): Independent contractors get paid by cash or check with no withholding   of any kind. This means that you are responsible for all of the Social   Security and Medicare normally paid or withheld by your employer; this   is called Self-Employment Tax. In order to take your deductions, you   will need to complete a Schedule C, which breaks down expenses into   even more detail. In addition to the items listed above, you will   probably have items in the following categories: Ideally, you should receive a 1099 MISC from whatever employer(s) paid you as an independent contractor. Keep in mind that some states have a non-resident entertainers' tax, which is  A state tax levied against performers whose legal residence is outside   of the state where the performance is given. The tax requires that a   certain percentage of any gross earnings from the performance be   withheld for the state. Seriously, keep all of your receipts, pay stubs, W2's, 1099 forms, contracts written on the backs of napkins, etc. and go see a tax professional."

negative: If the money comes to you, then it's income.  If the money goes out from you, it's an expense.  You get to handle the appropriate tax documentation for those business transactions. You may also have the pleasure of filing 1099-MISC forms for all of your blogging buddies if you've paid them more than $600.  (Not 100% sure on this one.) I was in a blog network that had some advertising deals, and we tried to keep the payments separate because it was cleaner that way. If I were you, I'd always charge a finder's fee because it is extra work for you to do what you're doing.

negative: you either tell your financial department about them (e.g. I used to get a student's tax discount), or you file them separately. But you don't have to file anything by default.  That is a comment connected to the question.  In the united states you can almost achieve this. 90% of the numbers on my tax form are automated. The W-2s are sent to the IRS, the 1099-s for my non retirement accounts are also sent. The two biggest items that take time are charities, and the educational benefits. Nobody has to claim every deduction they are entitled to. They must claim all the income, and decide to take the standard deduction. It would probably take less than an hour to finish the families taxes: both federal and state.

negative: "It is true, as farnsy noted, that you generally do not know when stock that you're holding has been loaned by your broker to someone for a short sale, that you generally consent to that when you sign up somewhere in the small print, and that the person who borrows has to make repay and dividends. The broker is on the hook to make sure that your stock is available for you to sell when you want, so there's limited risk there. There are some risks to having your stock loaned though.  The main one is that you don't actually get the dividend.  Formally, you get a ""Substitute Payment in Lieu of Dividends.""  The payment in lieu will be taxed differently.  Whereas qualified dividends get reported on Form 1099-DIV and get special tax treatment, substitute payments get reported on Form 1099-MISC. (Box 8 is just for this purpose.)  Substitute payments get taxed as regular income, not at the preferred rate for dividends. The broker may or may not give you additional money beyond the dividend to compensate you for the extra tax. Whether or not this tax difference matters, depends on how much you're getting in dividends, your tax bracket, and to some extent your general perspective. If you want to vote your shares and exercise your ownership rights, then there are also some risks.  The company only issues ballots for the number of shares issued by them.  On the broker's books, however, the short sale may result in more long positions than there are total shares of stock. Financially the ""extra"" longs are offset by shorts, but for voting this does not balance. (I'm unclear how this is resolved - I've read that the the brokers essentially depend on shareholder apathy, but I'd guess there's more to it than that.) If you want to prevent your broker from loaning out your shares, you have some options:"

negative: "The Trustee has allowed me to act as his ""agent"", continuing to pay   bills, and take care of much of the administrative affairs for my   mother's estate since I did all of it for years before she passed   away. I was not paid for any of this work. ... The expenses were more than $30K last year, and there is still a punch list to go this year. The trust should reimburse your expenses and deduct them on the trust tax return. Since the Trust owned the property in 2015, and I will receive ownership this month, can last year's expenses incurred for the Trust be deducted again future income for my property this year?  Not exactly. The trust will file its own tax return and will report the income/loss attributed to the beneficiaries per the trust rules. What is attributed to you will flow to your Schedule E. From there you own it and if it is a passive activity where the loss is limited - you can carry it forward and offset with future gain. The trustee will have to deal with all the paperwork. Do 1099-misc forms need to be filed for the contractors who worked to get it ready for rental? It is my understanding that since 2010 (and before 2010) landlords who are not in real-estate trade or business are not required to send out 1099. But it won't hurt if you do, also. In any case - for all of these issues you should talk to a tax adviser (EA/CPA licensed in your State)."

negative: This is a common occurrence, I know people who moved and then only remember the next spring during tax season that they never filed a new state version of a W-4. Which means for 3 or 4 months in the new year money is sent to the wrong state capital, and way too much was sent the previous year. In the spring of 2016 you should have filed a non-resident tax form with Michigan. On that form you would specify your total income numbers, your Michigan income numbers, and your other-state income numbers; with Michigan + other equal to total. That should have resulted in getting all the state taxes that were sent to Michigan returned.  It is possible that the online software is unable to complete the non-resident tax form. Not all forms and situations can be addressed by the software. So you may need to fill out paper forms. You should be able to find what you need on the state of Michigan website for 2015 Taxes. A quick read shows that you will probably need the Michigan 1040, schedule 1 and Schedule NR You may run into an issue if your license, car registration, voter registration, and other documentation point to you being a resident for the part of the year you earned that income. That means you will have to submit Form 3799 Statement to Determine State of Domicile You want to do this soon because there are deadlines that limit how far back you can files taxes. The state may also get tax information from the IRS and could decide that all your income from 2015 should have applied to them, so they will be sending you a tax bill plus penalties for failure to file.

negative: "You should contact the company and the broker about the ownership. Do you remember ever selling your position? When you look back at your tax returns/1099-B forms - can you identify the sale? It should have been reported to you, and you should have reported it to the IRS. If not - then you're probably still the owner. As to K-1 - the income reported doesn't have to be distributed to you. Partnership is a pass-through entity, and cannot ""accumulate"" earnings for tax purposes, everything is deemed distributed. If, however, it is not actually distributed - you're still taxed on the income, but it is added to your basis in the partnership and you get the tax ""back"" when you sell your position. However, you pay income tax on the income based on the kind of the income, and on the sale - at capital gains rates. So the amounts added to your position will reduce your capital gains tax, but may be taxed at ordinary rates. Get a professional advice on the issue and what to do next, talk to a EA/CPA licensed in New York."

negative: As a new (very!) small business, the IRS has lots of advice and information for you. Start at https://www.irs.gov/businesses/small-businesses-self-employed and be sure you have several pots of coffee or other appropriate aid against somnolence.  By default a single-member LLC is 'disregarded' for tax purposes (at least for Federal, and generally states follow Federal although I don't know Mass. specifically), although it does have other effects. If you go this route you simply include the business income and expenses on Schedule C as part of your individual return on 1040, and the net SE income is included along with your other income (if any) in computing your tax. TurboTax or similar software should handle this for you, although you may need a premium version that costs a little more.  You can 'elect' to have the LLC taxed as a corporation by filing form 8832, see https://www.irs.gov/businesses/small-businesses-self-employed/limited-liability-company-llc . In principle you are supposed to do this when the entity is 'formed', but in practice AIUI if you do it by the end of the year they won't care at all, and if you do it after the end of the year but before or with your first affected return you qualify for automatic 'relief'. However, deciding how to divide the business income/profits into 'reasonable pay' to yourself versus 'dividends' is more complicated, and filling out corporation tax returns in addition to your individual return (which is still required) is more work, in addition to the work and cost of filing and reporting the LLC itself to your state of choice. Unless/until you make something like $50k-100k a year this probably isn't worth it. 1099 Reporting. Stripe qualifies as a 'payment network' and under a recent law payment networks must annually report to IRS (and copy to you) on form 1099-K if your account exceeds certain thresholds; see https://support.stripe.com/questions/will-i-receive-a-1099-k-and-what-do-i-do-with-it  . Note you are still legally required to report and pay tax on your SE income even if you aren't covered by 1099-K (or other) reporting. Self-employment tax. As a self-employed person (if the LLC is disregarded) you have to pay 'SE' tax that is effectively equivalent to the 'FICA' taxes that would be paid by your employer and you as an employee combined. This is 12.4% for Social Security unless/until your total earned income exceeds a cap (for 2017 $127,200, adjusted yearly for inflation), and 2.9% for Medicare with no limit (plus 'Additional Medicare' tax if you exceed a higher threshold and it isn't 'repealed and replaced'). If the LLC elects corporation status it has to pay you reasonable wages for your services, and withhold+pay FICA on those wages like any other employer. Estimated payments. You are required to pay most of your individual income tax, and SE tax if applicable, during the year (generally 90% of your tax or your tax minus $1,000 whichever is less). Most wage-earners don't notice this because it happens automatically through payroll withholding, but as self-employed you are responsible for making sufficient and timely estimated payments, and will owe a penalty if you don't. However, since this is your first year you may have a 'safe harbor'; if you also have income from an employer (reported on W-2, with withholding) and that withholding is sufficent to pay last year's tax, then you are exempt from the 'underpayment' penalty for this year.  If you elect corporation status then the corporation (which is really just you) must always make timely payments of withheld amounts, according to one of several different schedules that may apply depending on the amounts; I believe it also must make estimated payments for its own liability, if any, but I'm not familiar with that part.

negative: You have to file and issue each one of them a 1099 if you are paying them $600 or more for the year. Because you need to issue a 1099 to them (so they can file their own taxes), I don't think there's a way that you could just combine all of them. Additionally, you may want to make sure that you are properly classifying these people as contractors in case they should be employees.

negative: "Does he need to file a tax return in this situation? Will the IRS be concerned that he did not file even if he received a 1099? No. However, if you don't file the IRS may come back asking why, or ""make up"" a return for you assuming that the whole amount on the 1099-MISC is your net earnings. So in the end, I suspect you'll end up filing even though you don't have to, just to prove that you don't have to. Bottom line - if you have 1099 income (or any other income reported to the IRS that brings you over the filing threshold), file a return."


query: Long(100%)-Short(-100%) investment explanation

positive: There is no difference.  When dealing with short positions, talking about percentages become very tricky since they no longer add up to 100%.  What does the 50% in your example mean?  Unless there's some base amount (like total amount of the portfolio, then the percentages are meaningless.  What matters when dealing with long and short positions is the net total - meaning if you are long 100 shares on one stock trade and short 50 shares on another, then you are net long 50 shares.

positive: If you mean the percentages of long/short positions within a mutual fund or ETF, then it's a percentage of the total value of the fund portfolio. In that case, positions of 50% in X, -50% in Y are not the same as 100% in X, -100% in Y. If the long and short positions are both for the same asset, then, as D Stanley mentions, all that matters is the net position. If you're equally long and short X, then the net position is always 0%.

positive: "When portfolio positions are reported in percentages, those percentages are relative to the portfolio's base equity.  When you start out, that is equal to the cash you have in a portfolio.  Later it's the net equity of the portfolio (i.e., how much money you could withdraw if you were to exit all your positions). If you put $5,000 into your account and are long and short 50%, then you are long $2,500 and short $2,500.  If it's 100% and -100%, then long and short $5,000. ""Leverage"" is often computed gross (as if all positions were long).  So if you have 100% and -100%, then your broker may say you are ""levered 2 to 1.""  That is, your gross exposure is twice as large as your underlying base equity."

negative: "You cannot get ""your investment"" out and ""leave only the capital gains"" until they become taxable at the long-term rate. When you sell some shares after holding them for less than a year, you have capital gains on which you will have to pay taxes at the short-term capital gains rate (that is, at the same rate as ordinary income).  As an example, if you bought 100 shares at $70 for a net investment of $7000, and sell 70 of them at $100 after five months to get your ""initial investment back"", you will have short-term capital gains of $30 per share on the 70 shares that you sold and so you have to pay tax on that $30x70=$2100. The other $4900 = $7000-$2100 is ""tax-free"" since it is just your purchase price of the 70 shares being returned to you.  So after paying the tax on your short-term capital gains, you really don't have your  ""initial investment back""; you have something less. The capital gains on  the 30 shares that you continue to hold will become (long-term capital gains) income to you only when you sell the shares after having held them for a full year or more: the gains on the shares sold after five months are taxable income in the year of sale."

negative: Simple math. Take the sale proceeds (after trade expenses) and divide by cost. Subtract 1, and this is your return. For example, buy at 80, sell at 100, 100/80 = 1.25, your return is 25%. To annualize this return, multiply by 365 over the days you were in that stock. If the above stock were held for 3 months, you would have an annualized return of 100%.  There's an alternative way to annualize, in the same example above take the days invested and dive into 365, here you get 4. I suggested that 25% x 4 = 100%. Others will ask why I don't say 1.25^4 = 2.44 so the return is 144%/yr. (in other words, compound the return, 1.25x1.25x...) A single day trade, noon to noon the next day returning just 1%, would multiply to 365% over a year, ignoring the fact there are about 250 trading days. But 1.01^365 is 37.78 or a 3678% return. For long periods, the compounding makes sense of course, the 8%/yr I hope to see should double my money in 9 years, not 12, but taking the short term trades and compounding creates odd results of little value.

negative: Simple math: 50-25=25, hence decline from 50 to 25 is a 50% decline (you lose half), while an advance from 25 to 50 is 100% gain (you gain 100%, double your 25 to 50). Their point is that if you have more upswings than downswings - you'll gain more on long positions during upswings than on short positions during downswings on average. Again - simple math.

negative: "An important point yet to be mentioned is that, with a standard investment, the most you can lose of your £100 stake is £100 (if the company literally goes bust, say). With shorting on the other hand, your downside is not limited to your initial stake.  You could ""invest"" £100, but end up owing £200, £500, or, well, the sky's the limit. Shorting is dangerous even for experienced investors.  For a beginner, it is about the worst possible investment strategy I can think of!"

negative: Imagine a stock where the share price equals the earnings per share.  You pay say $100 for a share. In the next year, the company makes $100 per share. They can pay a $100 dividend, so now you have your money back, and you still own the share. Next year, they make $100 per share, pay a $100 dividend, so now you have your money back, plus $100 in your pocket, plus you own the share. Wow. What an incredible investment.

negative: 200% margin for a short sale is outrageous. You should only need to put up 150% margin, of which 50% is your money, and the 100% is the proceeds.  With $100 of your money, you should be able to buy $100 of GOOG and short $100 of PNQI.

negative: "Suppose you have $100 today and suppose that hamburgers cost $5. If you are holding $100, you could buy 20 hamburgers at $5 each. Now suppose you take that $100 and stuff it under your mattress for 24 years. When you pull out your money, you still have $100, but it turns out hamburgers now cost $10.   The increase from $5 to $10 is inflation.   Your savings of $100 was ""eroded"" by half even though before and after you had $100 and now you can only buy 10 hamburgers instead of 20 hamburgers. Suppose inflation is 3%.   That means that if you earn 3% return on your investments, you'll stay even with inflation (If you can buy 20 hamburgers today, then at any point you can still buy 20 hamburgers).   If you want your money to grow in a real, tangible way you'll want to seek returns that beat the rate of inflation."

negative: "The process of borrowing shares and selling them is called shorting a stock, or ""going short.""  When you use money to buy shares, it is called ""going long."" In general, your strategy of going long and short in the same stock in the same amounts does not gain you anything.  Let's look at your two scenarios to see why. When you start, LOOT is trading at $20 per share.  You purchased 100 shares for $2000, and you borrowed and sold 100 shares for $2000.  You are both long and short in the stock for $2000.  At this point, you have invested $2000, and you got your $2000 back from the short proceeds.  You own and owe 100 shares. Under scenario A, the price goes up to $30 per share.  Your long shares have gone up in value by $1000.  However, you have lost $1000 on your short shares.  Your short is called, and you return your 100 shares, and have to pay interest.  Under this scenario, after it is all done, you have lost whatever the interest charges are. Under scenario B, the prices goes down to $10 per share.  Your long shares have lost $1000 in value.  However, your short has gained $1000 in value, because you can buy the 100 shares for only $1000 and return them, and you are left with the $1000 out of the $2000 you got when you first sold the shorted shares.  However, because your long shares have lost $1000, you still haven't gained anything.  Here again, you have lost whatever the interest charges are. As explained in the Traders Exclusive article that @RonJohn posted in the comments, there are investors that go long and short on the same stock at the same time.  However, this might be done if the investor believes that the stock will go down in a short-term time frame, but up in the long-term time frame.  The investor might buy and hold for the long term, but go short for a brief time while holding the long position. However, that is not what you are suggesting.  Your proposal makes no prediction on what the stock might do in different periods of time.  You are only attempting to hedge your bets.  And it doesn't work.  A long position and a short position are opposites to each other, and no matter which way the stock moves, you'll lose the same amount with one position that you have gained in the other position.  And you'll be out the interest charges from the borrowed shares every time. With your comment, you have stated that your scenario is that you believe that the stock will go up long term, but you also believe that the stock is at a short-term peak and will drop in the near future.  This, however, doesn't really change things much.  Let's look again at your possible scenarios. You believe that the stock is a long-term buy, but for some reason you are guessing that the stock will drop in the short-term.  Under scenario A, you were incorrect about your short-term guess.  And, although you might have been correct about the long-term prospects, you have missed this gain.  You are out the interest charges, and if you still think the stock is headed up over the long term, you'll need to buy back in at a higher price. Under scenario B, it turns out that you were correct about the short-term drop.  You pocket some cash, but there is no guarantee that the stock will rise anytime soon.  Your investment has lost value, and the gain that you made with your short is still tied up in stocks that are currently down. Your strategy does prevent the possibility of the unlimited loss inherent in the short.  However, it also prevents the possibility of the unlimited gain inherent in the long position.    And this is a shame, since you fundamentally believe that the stock is undervalued and is headed up.  You are sabotaging your long-term gains for a chance at a small short-term gain."

negative: Your original example is a little confusing because just shorting for 1k and buying for 1k is 100% leveraged or an infinitive leverage ratio. (and not allowed) Brokerage houses would require you to invest some capital in the trade.  One example might be requiring you to hold $100 in the brokerage.  This is where the 10:1 ratio comes from. (1000/10) Thus a return of 4.5% on the 1000k bond and no movement on the short position would net you $45 and voila a 45% return on your $100 investment. A 40 to 1 leverage ratio would mean that you would only have to invest $25 to make this trade.  Something that no individual investor are allowed to do, but for some reason some financial firms have been able to.

negative: The answer provide by @mbhunter is correct, however there are contexts, shorting in spot market and carrying the position over settlement usually does not entail payment of dividend to the broker, one of the reason being post ex-date the price of the share downward adjusts to the extent of the dividend, so practically if you have shorted at 100 and post ex-date (assuming a dividend of 2 and no movement of the stock price), the price would slide to 98, the party who longed the stock @ 100 now is sitting on a price of 98 and received a dividend of 2 which equates to 100. The above is also contextual to the law of the country governing the exchange and the security exchange board regulations.

negative: There are two obvious cases in which your return is lower with a heavily leveraged investment. If a $100,000 investment of your own cash yields $1000 that's a 1% return. If you put in $50,000 of your own money and borrow $50,000 at 2%, you get a 0% return (After factoring in the interest as above.) If you buy an investment for $100,000 and it loses $1000, that's a -1% return. If you borrow $100,000 and buy two investments, and they both lose $1000, that's a -2% return.

negative: Long convexity is achieved by owning long dated low delta options. When a significant move occurs in the underlying the volatility curve will move higher. Instead of a linear relationship between your long position and it's return, you receive a multiple of the linear return. For example: Share price $50 Long 1 (equals 100 shares) contract of a 2 year 100 call Assume this is a 5 delta option If the stock price rises to $70 the delta of the option will rise because it is now closer to the strike. Lets assume it is now a 20 delta option. Then  Expected return on a $20 price move higher, 100 shares($20)(.20-.05)=$300 However what happens is the entire volatility surface rises and causes the 20 delta option to be 30 delta option. Then The return on a $20 price move higher, 100 shares($20)(.30-.05)=$500 This $200 extra gain is due to convexity and explains why option traders are willing to pay above the theoretical price for these options.

negative: You made 94$ on an investment of 554.80 *100 = 55480$ for an approx holding period of 1 year. So the % return is ~0.16%, which is not much better than the short term us treasury rate. The current 1 year treasury rate is 0.27%: http://ycharts.com/indicators/1_year_treasury_rate So yes, you have a risk free portfolio, so you make the risk free rate. Remember this is an European option, so you are stuck for 1 year. if you found the same mispricing in an American option, then you found an arbitrage.

negative: We struck a deal. I sold an asset to some body on june 1 . However he says, he would pay me any time on or before august 1st . This puts me in a dilemma.  What if price goes down by august 1st and i would have to accept lower payment from him.? If price goes up till august 1st, then obviously i make money since ,even though item is sold,price is yet to be fixed between parties. However i know anytime on or before august 1st, i would get paid the price quoted on that particular day. This price could be high in my favor, or low against me. And, this uncertainty is causing me sleepless nights. i went to futures market exchange. My item (sugar,gold,wheat,shares etc..anything). i short sell a futures which just happens to be equivalent to the quantity of my amount i sold to the acquirer of my item. I shorted at $ 100 , with expiry on august 1st. Now fast orward and august 1st comes. price is $ 120 quoted . lets Get paid from the guy who was supposed to pay on or before august 1st. He  pays 120 $. his bad luck, he should have paid us 100 $ on june 1st instead of waiting for august 1st . His judgement of price movement faulted. WE earned 20 $ extra than we expected to earn on june 1st (100$) . However the futures short of 100$ is now 120$ and you must exit your position by purchasing it at back. sell at 100$ and buy at 120$ = loss of 20$ . Thus 20 $ gained from selling item is forwarded to exchange . Thus we had hedged our position on june 1st and exit the hedge by august 1st. i hope this helps

negative: Don't know the name but it means you're long with conviction :P  Unlimited gains, maximum loss of 95$  + (8-6) = 97$.  Basically You are long @ 107  - -2 from 105 to 95.  You would have to be ULTRA bullish to initiate this strategy.

negative: Fidelity has a good explanation of Restricted Stock Awards: For grants that pay in actual shares, the employee’s tax holding period begins at the time of vesting, and the employee’s tax basis is equal to the amount paid for the stock plus the amount included as ordinary compensation income. Upon a later sale of the shares, assuming the employee holds the shares as a capital asset, the employee would recognize capital gain income or loss; whether such capital gain would be a short- or long-term gain would depend on the time between the beginning of the holding period at vesting and the date of the subsequent sale. Consult your tax adviser regarding the income tax consequences to you. So, you would count from vesting for long-term capital gains purposes.  Also note the point to include the amount of income you were considered to have earned as a result of the original vesting [market value then - amount you paid].  (And of course, you reported that as income in 2015/2016, right?) So if you had 300 shares of Stock ABC granted you in 2014 for a price of $5/share, and in 2015 100 of those shares vested at FMV $8/share, and in 2016 100 of those shares vested, current FMV $10/share, you had $300 in income in 2015 and $500 of income in 2016 from this.   Then in 2017 you sold 200 shares for $15/share:

negative: I have found a good explanation here: http://www.contracts-for-difference.com/Financing-charge.html Financing is calculated by taking the overall position size, and multiplying it by (LIBOR + say 2%) and then dividing by 365 x the amount of days the position is open. For instance, the interest rate applicable for overnight long positions may be 6% or 0.06. To calculate how much it would cost you to hold a long position for X number of days you would need to make this 'pro rata' meaning that you would need to divide the 0.06 by 365 and multiply it by X days and then multiply this by the trade size. So for example, for a trade size of $20,000, held for 30 days, the interest cost would be about $98.6. It is important to note that due to financing, long positions held for extended periods can reduce returns.

negative: The problem with rate of return calculation on short positions is, that the commonly used approach assumes an initial investment creating a cash outflow. If we want to apply this approach to short selling, we should look at the trade from another perspective. We buy money and pay for this money with stock. Our investment to buy 50$ in your example is 1 share.  When closing the short position, we effectively sell back our money (50$) and receive 2 shares. Our profit on this position is obviously 1 share. Setting this in relation to our investment of 1 share yields a performance of 100%   in reality, we do not sell back the entire cash but only the amount needed to get back our investment of 1 share. This is actually comparable to a purchase of stock which we only partially close to get back our invested cash amount and keep the remaining shares as our profit

negative: Option contracts typically each represent 100 shares. So the 1 call contract you sold to open (wrote) grants the buyer of that option the right to purchase your 100 shares for $80.00 per share any time before the option expiration date. You were paid a gross amount of $100 (100 shares times $1.00 premium per share) for taking on the obligation to deliver should the option holder choose to exercise. You received credit in your account of $89.22, which ought to be the $100 less any trading commission (~$10?) and miscellaneous fees (regulatory, exchange, etc.) per contract. You did capture premium. However, your covered call write represents an open short position that, until either (a) the option expires worthless, or (b) is exercised, or (c) is bought back to close the position, will continue to show on your account as a liability. Until the open position is somehow closed, the value of both the short option contract and long stock will continue to fluctuate. This is normal.

negative: I don't know the legal framework for RSUs, so I'm not sure what is mandatory and what is chosen by the company issuing them. I recently reviewed one companies offering and it basically looked like a flat purchase of stock on the VEST date. So even if I got a zillion shares for $1 GRANTED to me, if it was 100 shares that vested at $100 on the 1st, then I would owe tax on the market value on the day of vest. Further, the company would withhold 25% of the VEST for federal taxes and 10% for state taxes, if I lived in a state with income tax. The withholding rate was flat, regardless of what my actual tax rate was. Capital gains on the change from the market value on the VEST date was calculated as short-term or long-term based on the time since the VEST date. So if my 100 shares went up to $120, I would pay the $20 difference as short term or long term based on how long I had owned them since the VEST. That said, I don't know if this is universal. Your HR folks should be able to help answer at least some of these questions, though I know their favorite response when they don't know is that you should consult a tax professional. Good luck.

negative: Let's use an example: You buy 10 machines for 100k, and those machines produce products sold for a total of 10k/year in profit (ignoring labor/electricity/sales costs etc). If the typical investor requires a rate of return of 10% on this business, your company would be worth 100k.  In investing terms, you would have a PE ratio of 10.  The immediately-required return will be lower if substantially greater returns are expected in the future (expected growth), and the immediately required return will be higher if your business is expected to shrink. If at the end of the year you take your 10k and purchase another machine, your valuation will rise to 110k, because you can now produce 11k in earnings per year.  If your business has issued 10,000 shares, your share price will rise from $10 to $11.  Note that you did not just put cash in the bank, and that you now have a higher share price. At the end of year 2, with 11 machines, lets imagine that customer demand has fallen and you are forced to cut prices.  You somehow produce only 10k in profit, instead of the anticipated 11k.  Investors believe this 10k in annual profit will continue into the forseable future.  The investor who requires 10% return would then only value your company at 100k, and your share price would fall back from $11 to $10.  If your earnings had fallen even further to 9k, they might value you at 90k (9k/0.1=$90k).  You still have the same machines, but the market has changed in a way that make those machines less valuable. If you've gone from earning 10k in year one with 10 machines to 9k in year two with 11 machines, an investor might assume you'll make even less in year three, potentially only 8k, so the value of your company might even fall to 80k or lower.  Once it is assumed that your earnings will continue to shrink, an investor might value your business based on a higher required rate of return (e.g. maybe 20% instead of 10%), which would cause your share price to fall even further.

negative: "It will be helpful to establish some definitions: Long ""Long"" is financial slang for ""to have possession of an asset"", legally, and ""to debit an asset"", financially.   Short ""Short"" is financial slang for ""to be liable for an asset"", legally, and ""to credit an asset"", financially. Option ""Option"" is financial slang for ""to have the right but not obligation to force the liable to perform action"", legally.  Without limits and when taken to absurdity, this can mean slavery.  For equities, this means ""to have the right but not the obligation to force the liable to buy/sell a specified asset at a specified price with a specified expiration for that right"" for a call/put, respectively. By the above, a call option is ""the right but not the obligation to force the liable to buy a specified asset at a specified price with a specified expiration for that right"". By the definition of ""long"" above, a call option is actually not long the underlying. By the definitions above and with a narrower scope applied to equities & indexes, to be ""long"" the call means ""to have the right but not the obligation to force the liable to buy a specified asset at a specified price with a specified expiration for that right"" while to be ""short"" the call means ""to have the obligation to be forced to sell a specified asset at a specified price with a specified expiration for that right"". So, to be ""long"" a call means to simply own the call."

negative: "I like this explanation the best.  EV is trying to get at the value of the underlying business, excluding the capital structure you currently have on the company.  If your lemonade stand is worth $100, but the business also comes with $50 in cash lying around (and no debt), then the EV is $100.  But the price you'd pay the owner (the ""market cap"") is $150, because it's like you get an immediate cash rebate."

negative: In the money puts and calls are subject to automatic execution at expiration. Each broker has its own rules and process for this.  For example, I am long a put. The strike is $100. The stock trades at the close, that final friday for $90. I am out to lunch that day. Figuratively, of course. I wake up Saturday and am short 100 shares. I can only be short in a margin account. And similarly, if I own calls, I either need the full value of the stock (i.e. 100*strike price) or a margin account.  I am going to repeat the key point. Each broker has its own process for auto execution. But, yes, you really don't want a deep in the money option to expire with no transaction.  On the flip side, you don't want to wake up Monday to find they were bought out by Apple for $150.

negative: One way I heard of, from a friend who ran a similar fund as yours, is to calculate $days of investment and divide the investment as accordingly.  For example, If I invested 10$ for 10 days and you have invested 20$ for 5 days. At the end of the 10th day my $day = 10*10=100, while your $day=20*5=100. If the investement has grown to 100$, the I should get $100/(100+100)*100=$50, you also should get the same. This I guess is equitable, you could try dividing the corpus with above method. It consideres the amount invested as well as the time invested for. I think by the above method, you could also handle the inbetween withdrawals.

negative: What always impressed my interviewers was talking about my stock trading experience. They don't care if you're investing $100 or $100k as long as you can talk about the story of what you look for in an investment, why you're trading, what your process is. All of that goes a long way to showing you're interested beyond classes.

negative: When you buy a stock, the worst case scenario is that it drops to 0.  Therefore, the most you can lose when buying a stock is 100% of your investment. When you short a stock, however, there's no limit on how high the stock can go.  If you short a stock at 10, and it goes up to 30, then you've lost 200% on your investment.  Therefore shorting stocks is riskier than buying stocks, since you can lose more than 100% of your investment when shorting. because the price might go up, but it will never be as big of a change as a regular price drop i suppose... That is not true.  Stocks can sometimes go up significantly (50-100% or more) in a very short amount of time on a positive news release (such as an earnings or a buyout announcement).  A famous example occurred in 2008, when Volkswagen stock quintupled (went up 400%) in less than 2 days on some corporate news: Porsche, for some reason, wants to control Volkswagen, and by building up its stake has driven up the price. Hedge funds, figuring the share price would fall as soon as Porsche got control and stopped buying, sold a lot of VW shares short. Then last weekend, Porsche disclosed that it owned 42.6 percent of the stock and had acquired options for another 31.5 percent. It said it wanted to go to 75 percent. The result: instant short-squeeze. The German state of Lower Saxony owns a 20 percent stake in VW, which it said it would not sell. That left precious few shares available for anyone else. The shorts scrambled to cover, and the price leaped from about €200, or about $265, to above €1,000.

negative: "When trading Forex each currency is traded relative to another. So when shorting a currency you must go long another currency vs the currency you are shorting, it seems a little odd and can be a bit confusing, but here is the explanation that Wikipedia provides: An example of this is as follows: Let us say a trader wants to trade   with the US dollar and the Indian rupee currencies. Assume that the   current market rate is USD 1 to Rs.50 and the trader borrows Rs.100.   With this, he buys USD 2. If the next day, the conversion rate becomes   USD 1 to Rs.51, then the trader sells his USD 2 and gets Rs.102. He   returns Rs.100 and keeps the Rs.2 profit (minus fees). So in this example the trader is shorting the rupee vs the dollar. Does this article add up all other currency crosses to get the 'net' figure? So they don't care what it is depreciating against? This data is called the Commitment of Traders (COT) which is issued by the Commodity Futures Trading Commission (CFTC)  In the WSJ article it is actually referring to Forex Futures. In an another article from CountingPips it explains a bit clearer as to how a news organization comes up with these type of numbers. according to the CFTC COT data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc. So this article is not talking about futures but it does tell us they got data from the COT and in addition Reuters added additional calculations from adding up ""X"" currency positions. No subscription needed: Speculators Pile Up Largest Net Dollar Long Position Since June 2010 - CFTC Here is some additional reading on the topic if you're interested: CFTC Commitment of the Traders Data – COT Report FOREX : What Is It And How Does It Work? Futures vs. Forex Options Forex - Wiki"

negative: "an account balance is your total in the account.  The word balance means ""to be equal"". The use in finance stem from accounting. However you do not need to know why its called a balance to understand that a balance is equal to something. IE: your ""account balance"" is your total account weather its savings, electric bill, or investment portfolio. A position in your investment portfolio is what you are invested in. IE: If I went 100 shares long(I bought) Apple then I have a 100 share position in Apple. Your position is added to your account balance within your investment portfolio."

negative: You are likely thinking of a individual variable insurance contract (IVIC) , better known as a segregated fund, or a principal-protected note (PPN). For a segregated fund, to get a full guarantee on invested capital, you need a 100/100 where the maturity value and death benefit are each 100% guaranteed. The PPN works similar to a long-term GIC (or CD) with a variable investment component.  The thing is, neither of these things are cheap and the cost structure that is built in behind them makes it difficult to make any real above market rates of return. In both cases, if you try to break the contracts early then the guarantees are null and void and you get out what you get out.

negative: "Some thoughts on your questions in order, Duration: You might want to look at the longest-dated option (often a ""LEAP""), for a couple reasons. One is that transaction costs (spread plus commission, especially spread) are killer on options, so a longer option means fewer transactions, since you don't have to keep rolling the option. Two is that any fundamentals-based views on stocks might tend to require 3-5 years to (relatively) reliably work out, so if you're a fundamental investor, a 3-6 month option isn't great. Over 3-6 months, momentum, short-term news, short squeezes, etc. can often dominate fundamentals in determining the price. One exception is if you just want to hedge a short-term event, such as a pending announcement on drug approval or something, and then you would buy the shortest option that still expires after the event; but options are usually super-expensive when they span an event like this. Strike: Strike price on a long option can be thought of as a tradeoff between the max loss and minimizing ""insurance costs."" That is, if you buy a deeply in-the-money put or call, the time value will be minimal and thus you aren't paying so much for ""insurance,"" but you may have 1/3 or 1/2 of the value of the underlying tied up in the option and subject to loss. If you buy a put or call ""at the money,"" then you might have only say 10% of the value of the underlying tied up in the option and subject to loss, but almost the whole 10% may be time value (insurance cost), so you are losing 10% if the underlying stock price stays flat. I think of the deep in-the-money options as similar to buying stocks on margin (but the ""implied"" interest costs may be less than consumer margin borrowing rates, and for long options you can't get a margin call). The at-the-money options are more like buying insurance, and it's expensive. The commissions and spreads add significant cost, on top of the natural time value cost of the option. The annual costs would generally exceed the long-run average return on a diversified stock fund, which is daunting. Undervalued/overvalued options, pt. 1: First thing is to be sure the options prices on a given underlying make sense at all; there are things that ""should"" hold, for example a synthetic long or short should match up to an actual long or short. These kinds of rules can break, for example on LinkedIn (LNKD) after its IPO, when shorting was not permitted, the synthetic long was quite a bit cheaper than a real long. Usually though this happens because the arbitrage is not practical. For example on LNKD, the shares to short weren't really available, so people doing synthetic shorts with options were driving up the price of the synthetic short and down the price of the synthetic long. If you did actually want to be long the stock, then the synthetic long was a great deal. However, a riskless arbitrage (buy synthetic long, short the stock) was not possible, and that's why the prices were messed up. Another basic relationship that should hold is put-call parity: http://en.wikipedia.org/wiki/Put%E2%80%93call_parity Undervalued/overvalued options, pt. 2: Assuming the relationship to the underlying is sane (synthetic positions equivalent to actual positions) then the valuation of the option could focus on volatility. That is, the time value of the option implies the stock will move a certain amount. If the time value is high and you think the stock won't move much, you might short the option, while if the time value is low and you think the stock will move a lot, you might buy the option. You can get implied volatility from your broker perhaps, or Morningstar.com for example has a bunch of data on option prices and the implied components of the price model. I don't know how useful this really is though. The spreads on options are so wide that making money on predicting volatility better than the market is pretty darn hard. That is, the spread probably exceeds the amount of the mispricing. The price of the underlying is more important to the value of an option than the assumed volatility. How many contracts: Each contract is 100 shares, so you just match that up. If you want to hedge 100 shares, buy one contract. To get the notional value of the underlying multiply by 100. So say you buy a call for $30, and the stock is trading at $100, then you have a call on 100 shares which are currently priced at $10,000 and the option will cost $30*100=3,000. You are leveraged about 3 to 1. (This points to an issue with options for individual investors, which is that one contract is a pretty large notional value relative to most portfolios.)"

negative: a smaller spread indicates a flat yield curve, which means banks and investors are uncertain about future economic conditions (like the current environment).   When the spread widens and the curve becomes upward sloping (considered a normal yield curve), investors expect future growth and minimal inflation. Longer term rates increase as investors demand a higher yield in return for lending their money for a longer period of time. Increase demand for credit (industries expanding) also drive up longer term rates.   A negative spread indicates an inverted yield curve and investors believe the economy is overheating and interest rates will fall. Investors pull money out of the stock market and into long term bonds (raising the price, lowering the yield) while companies stop borrowing, reducing the demand for credit and lower the cost, or interest rate, on a loan.   Keep in mind central banks determine short term rates, so inverted curves are rare in the sense the market perceives uncertainty and rushes to safety (bonds) before the central bank reacts and lowers short term rates.