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Trader or Investor? Massachusetts Weighs in and the After-Tax Return of Investing Hangs on the Answer  


Author:  Robert N.  Gordon.


Source: Volume 29, Number 02, Winter 2012 , pp.69-72(4)




Journal of Taxation of Investments

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Abstract: 

For hedge funds, classification as a trader or as an investor is not a minor issue. Whether a particular hedge fund qualifies as a trader or an investor could determine whether—and how much— tax will need to be paid on phantom income. Massachusetts has now weighed in with definitive mathematical guidelines—at least for that state.

Keywords: hedge fund tax, trader, gross income tax states

Affiliations:  1: Twenty-First Securities Corporation.

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