Am I only taxed on net gains for stocks or every profitable trade?

That's such a relief! Thanks for explaining. So even if I made like $3000 in profitable trades but lost $2250 on others, I'm just taxed on the $750 difference? One more question - my brokerage app (Robinhood) shows all my trades. Will the 1099-B form automatically calculate my net gain/loss, or do I need to track everything manually throughout the year?

Yes, exactly! You're only taxed on that $750 difference. Your profitable trades minus your losing trades equals your taxable amount. Your 1099-B from Robinhood will show all your transactions, but I recommend checking it carefully. Brokerages sometimes miss cost basis information or make other errors. Robinhood will calculate your gains/losses, but it's smart to keep your own records throughout the year. Some people use spreadsheets or tax software like TurboTax that can import your trades directly. This makes tax time much easier, especially if you make lots of trades.

Does it work for crypto trades too? I have stocks on Robinhood but also some ETH and BTC on Coinbase that I've been swing trading. The crypto tax stuff confuses me even more than stocks.

How accurate is it compared to what your actual tax form from the broker showed? I've tried other tax software that claimed to handle investments but they messed up my cost basis on some of my older positions.

Yes, it handles crypto too! It connects to most major exchanges like Coinbase, Binance, etc. Crypto is actually where it really shines because those transactions can be a nightmare to track manually. It properly handles all the weird crypto tax rules too. For accuracy, it was spot-on with my broker's 1099 for most things, but actually caught two errors where my broker had incorrect cost basis info. I was able to get that fixed before filing, which probably saved me from an audit flag. It can detect discrepancies between what you actually did and what the broker is reporting, which is super helpful.

How does this actually work? Do they somehow jump the line or do they just sit on hold for you? I've got questions about my 1099-R but can never get through.

Sounds like BS to me. The IRS doesn't take appointments and everyone has to wait in the same queue. How could they possibly get you through faster than if you called yourself?

They don't jump the line - they wait in the same queue that you would, but their system handles the waiting instead of you having to sit there listening to hold music. When an agent finally picks up, their system calls your phone and connects you directly to the agent who's already on the line. It's not about getting through faster than the normal queue - it's about not wasting hours of your day actively waiting on hold. You go about your day, and when an agent is finally available, you get a call. In my case, I was able to go to class and run errands while their system waited on hold for me. When they called, I was connected to an agent who had already picked up.

That's really good to know about the $3,000 deduction limit! What exactly is the wash sale rule? I think I might have done that a few times - bought stock in the same company after selling it at a loss within a month. Does that mean I can't claim those losses at all?

The wash sale rule doesn't mean you lose the deduction forever - it just defers it. If you sell a stock at a loss and buy substantially identical securities within 30 days before or after the sale, you can't immediately claim that loss. Instead, the loss gets added to the cost basis of your new position. For example, if you sell XYZ at a $500 loss, then buy XYZ again two weeks later for $1000, your new cost basis would become $1500. You'll eventually get to use the loss when you sell the new position (assuming you don't trigger another wash sale). It's the IRS's way of preventing people from harvesting tax losses while maintaining essentially the same investment position.

Yes! This is actually a real headache. Each brokerage will send you a separate 1099-B, and you need to combine all your trading activity across all platforms when filling out your Schedule D. The IRS sees the total picture. Also be aware that some brokerages are better than others at tracking cost basis. Fidelity is generally pretty good, but some of the newer app-based platforms can be less reliable. You might need to make adjustments if the cost basis isn't reported correctly.

Thanks for that info. Sounds like I need to be extra careful tracking everything across accounts. Definitely don't want to mess up my taxes over this!

This is really helpful advice about the dependent status! I hadn't even thought about that affecting my capital gains rate. I am still claimed as a dependent on my parents' return, so I'll need to look into those different thresholds you mentioned. The point about tracking trading patterns is great too. I've been so focused on just trying not to lose money that I haven't really analyzed what's been working vs what hasn't. Do you have any recommendations for simple ways to track performance beyond just looking at overall portfolio value? And thanks for the encouragement about recovering from that drawdown - it was definitely a learning experience about position sizing and risk management!