Whenever we consider the benefits of trader tax status, the one item that tops the list is the ability to elect a special accounting method known as mark-to-market, or MTM for short.

Remember that hit movie “Lost in Translation,” in which a clueless Bill Murray wanders dumbstruck through the foreign and thoroughly baffling world of modern-day Tokyo?

Incorporation has many advantages for traders who want to grow their wealth by reinvesting profits and deducting trading expenses with a firm conviction that there is tax law standing behind a corporation that is not available to someone trying to trade as a “trader in securities”.

The Internal Revenue Service loves to tax capital gains, but they are just as diligent to disallow capital losses that might offset those lucrative cash cows. Case in point: the wash rule. The wash rule prohibits traders and investors from claiming a capital loss if they buy replacement stock 30 days before or after the sale of a security.

Put yourself for a moment in the shoes of one Anna E. Charlton, an adjunct law professor at Rutgers University who, along with her law professor husband Gary Francione, operated the Rutgers Animal Rights Law Clinic/Center from 1990 to 2000.