How do I report gains and losses on securities with the mark-to-market election?

If you qualify as a trader and made the mark-to-market election on or before April 15, 2025 (usually attached to your tax return), you can follow the instructions below to report your business expenses on Schedule C and your gains and losses on Form 4797.

To report expenses on Schedule C:

1. Go to the business income screen and add a new business.
2. Use the business to report any business expenses. Do not include any commissions or other costs of acquiring or disposing of securities here.

To report gains and losses on Form 4797:

1. Go to the Sale of Business Assets screen under the Common Income section.
2. Enter a new business asset.
3. Select that it was held for less than a year.
4. For the date sold, enter the date of the last business day in 2025.
5. For the sales price, enter the fair market value (FMV) on the last business day of 2025.
6. Fill out the rest of the info as applicable. You should likely enter $0 for depreciation.