Thank you for sharing such a detailed and honest breakdown of your SEE exam experience! As someone who just joined this community and is starting to research the EA certification path, your post is incredibly valuable and eye-opening. Your experience with spending 90+ hours on study materials that completely missed the mark is both frustrating and enlightening. It really highlights how misleading some test prep programs can be with their marketing promises of "comprehensive practice questions." The fact that you had practically memorized hundreds of practice questions but still felt lost during the actual exam clearly shows that quantity doesn't equal quality when it comes to exam preparation. I'm definitely taking the Passkey Books recommendation to heart, especially given all the positive reinforcement from other community members in this thread. It sounds like the fundamental difference is that quality materials focus on teaching underlying tax concepts and principles rather than just drilling random practice scenarios that may not reflect actual exam content. Your aggressive timeline is impressive, but I'm curious - given your experience with how dramatically different the actual exams were from your initial study materials, are you considering giving yourself a bit more time to thoroughly work through the Passkey approach for Part 3? It seems like building in adequate time for conceptual understanding might be more beneficial than maintaining a rushed pace. Thanks again for taking the time to share such a comprehensive account of both your challenges and successes. This kind of real-world insight from someone who's actually been through the process is exactly what newcomers like me need to make informed decisions about our study approach. Your experience will definitely help many of us avoid those same costly preparation mistakes!

Thank you so much for sharing this incredibly detailed and honest account of your SEE exam journey! As a newcomer to this community who's just starting to research the EA certification path, your experience is exactly what I needed to read before making any study material investments. Your story about spending 90+ hours on materials that didn't align with the actual exam content is both eye-opening and frustrating. It really drives home how misleading some test prep programs can be when they promise "comprehensive coverage" but deliver practice questions that bear no resemblance to the real exam. The fact that you had practically memorized all 250 practice questions but still felt completely lost during the actual test clearly demonstrates that understanding underlying tax concepts is infinitely more valuable than rote memorization. I'm definitely going to start with Passkey Books based on your recommendation and all the positive feedback throughout this thread. It sounds like the key differentiator is that quality materials focus on teaching tax principles and their application rather than just drilling disconnected practice scenarios that may never appear on the actual exam. One question about your experience - when you mentioned using "test-taking instincts" to get through Part 2 despite feeling unprepared, were there any specific strategies that helped you work through unfamiliar questions? I want to be prepared for the possibility of encountering unexpected material even with better study resources. Your timeline is quite ambitious, and I'm wondering if you're considering adjusting your approach for Part 3 given what you've learned about the importance of truly mastering the material? It seems like the 18-month window provides enough flexibility to prioritize thorough understanding over speed. Thanks again for such a comprehensive breakdown of both your struggles and successes. This kind of real-world insight from someone who's actually navigated the process is invaluable for newcomers trying to make informed preparation decisions!

Does the 3-year carryback apply to options on futures too? I trade E-mini S&P options and had massive losses this year, but wasn't sure if they qualify for the same treatment as regular futures contracts.

Just wanted to add some practical advice for anyone considering the Section 1256 carryback - make sure you have all your trading records organized before starting the process. You'll need detailed records of your Section 1256 gains from the previous 3 years to calculate exactly how much you can carry back. Also, be aware that filing Form 1045 (Application for Tentative Refund) can sometimes trigger additional IRS scrutiny, especially if you're claiming large refunds. It's not a reason to avoid using the carryback if you're entitled to it, but just be prepared to potentially provide additional documentation if requested. The carryback can be a huge tax benefit for traders who have volatile years, but the paperwork can be complex. Don't let that discourage you from claiming what you're legally entitled to - just make sure you do it correctly or get professional help if needed.

One thing to keep in mind is that even if you structure this as a loan arrangement, the IRS has something called "substance over form" doctrine. They look at the economic reality of the transaction, not just how it's labeled on paper. If you're essentially planning from the start to let the lender take your assets instead of repaying, the IRS could argue this was always intended as a sale, not a genuine loan. This could trigger immediate tax consequences and potentially penalties for trying to disguise a sale as something else. The safest approach is usually to treat any loan against appreciated assets as what it is - a way to access liquidity while maintaining ownership, with the understanding that you'll need to either repay the loan or face the tax consequences of disposition. The wealthy people you mentioned using these strategies typically have much more complex estate planning structures and legal teams to navigate the rules properly.

I've been researching this exact situation for months and want to add a few critical points that haven't been fully covered yet. First, the timing of when you declare your intent matters enormously. If you structure this as a genuine loan with real repayment terms and only later face financial hardship that prevents repayment, the tax treatment can be different than if you go in planning to default. Second, the type of asset matters. With stocks held in taxable accounts, any loan-related disposition triggers capital gains calculations. But if these are stocks in retirement accounts, the rules get even more complex because you're dealing with prohibited transaction rules on top of the regular tax implications. Third, consider state taxes too - some states have no capital gains tax, others treat loan forgiveness differently than the federal rules. If you're in California or New York, the state tax hit alone could be massive. The "buy, borrow, die" strategy mentioned earlier only works if you actually die while holding the assets. If you're forced to liquidate during your lifetime for any reason, all those deferred taxes come due. It's not a magic bullet unless you're certain about the long-term timeline. My advice? Get a tax attorney consultation before doing anything. The potential penalties for getting this wrong far exceed the cost of proper planning upfront.

This is exactly the kind of question I wish I'd asked before I started my own card business! I've been buying and selling Pokemon cards for about 18 months now, and let me tell you - the tax classification issue is way more nuanced than I initially thought. One thing that really helped me was keeping a detailed journal of my intentions when making each purchase. For items I genuinely planned to hold as investments, I wrote down my reasoning - things like "buying this sealed case because XYZ set historically appreciates 150% within 3-4 years post-rotation" with links to supporting data. For inventory purchases, I noted things like "buying to flip quickly due to current market demand spike." The frequency test is huge. I learned this the hard way when I got a bit too aggressive with flipping last year and the IRS could have easily argued I was running a business based on transaction volume alone. Now I'm much more selective about quick sales and make sure my long-term holds significantly outnumber short-term flips. Also, consider getting an EIN even if you think you might qualify for capital gains treatment. Having that business structure in place gives you flexibility to pivot your classification if your activity level changes, plus it looks more professional when working with distributors. The collectibles capital gains rate someone mentioned is real - that 28% vs 15-20% really adds up on bigger sales. Factor that into your profit calculations from the start!

Great question Connor! I've been in a similar situation with sports memorabilia and can share some hard-earned lessons. The key distinction the IRS looks at is your primary intent when purchasing. If you're buying with the main goal of profiting from resale, that leans toward business activity regardless of how long you hold the items. The 2-3 year timeline you mentioned actually works against the "investment" classification - true investors typically don't have predetermined exit strategies. Here are some practical considerations: **Business Classification Pros:** - Can deduct all legitimate expenses (storage, supplies, research tools, travel to card shops/conventions) - No $3,000 annual capital loss limitation if things go south - Can depreciate equipment and potentially claim home office deduction **Business Classification Cons:** - Subject to self-employment tax (15.3% on top of income tax) - Must use business accounting methods for inventory - More complex recordkeeping requirements **Investment Classification Pros:** - No self-employment tax - Potentially lower tax rates if you qualify for long-term capital gains **Investment Classification Cons:** - Limited expense deductions - Subject to the higher 28% collectibles capital gains rate (not the favorable 15-20% rate for stocks) - $3,000 annual limit on deducting capital losses Given your plan to regularly purchase sealed products specifically for resale profit, the IRS would likely classify this as business activity. I'd recommend embracing that classification from the start and taking advantage of the business expense deductions to offset the self-employment tax burden. Document everything meticulously and consider consulting with a tax pro who understands collectibles!

This is a great question and I've seen many organizations struggle with this exact issue. The key thing to understand is that the IRS looks at the direct recipient of the donation, not the ultimate destination, when determining tax deductibility. Since you're a 501(c)(7), donations made directly to your organization are not tax-deductible to the donor, even if you plan to pass 100% of the funds to a qualifying 501(c)(3). The donor's tax deduction is based on who they're writing the check to, not where the money eventually goes. Here are the cleanest approaches I've seen work: **Option 1: Direct donations with your club as organizer** Have donors make checks payable directly to the 501(c)(3) charity. Your club collects and forwards these donations. This maintains tax deductibility since the charity is the direct recipient. **Option 2: Charity-sponsored event** Work with the 501(c)(3) to officially sponsor your event. They handle all payment processing and issue tax receipts directly to donors. Your club focuses on event logistics and promotion. Regarding event expenses - if you use Option 1, you cannot use any of those donated funds for expenses since they belong to the charity. You'd need to cover event costs through separate fundraising (ticket sales, sponsorships, etc.) or have the charity reimburse you for approved expenses. I'd recommend speaking directly with the 501(c)(3) you're supporting - they likely have experience with this type of partnership and may have established procedures that make everything much simpler.

I've dealt with this exact situation with our local veterans' association fundraiser last year. What really helped us was getting everything documented upfront with the 501(c)(3) we were supporting. We ended up going with the direct donation approach - donors made checks payable to the charity, but we collected them at our event and forwarded them in batches. The charity provided us with donation forms that included their tax ID number and official letterhead, which made donors feel confident about the tax deductibility. One thing I'd strongly recommend is setting up a meeting with the charity's treasurer or development director before your event. They can walk you through their preferred process and may even provide pre-printed donation envelopes or receipts. Most established charities have handled this type of partnership before. Also, make sure you're crystal clear with potential donors about the process. We had signs at our registration table explaining that checks should be made out to the charity (not our club) for tax deduction purposes. This eliminated confusion and actually increased our donation totals since corporate sponsors knew they'd get proper documentation. The key is transparency and proper documentation - when everything is set up correctly, it benefits everyone involved.