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Calculating Adjusted Cost Base for Futures?
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Calculating Adjusted Cost Base for Futures?

  #1 (permalink)
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Calculating Adjusted Cost Base for Futures?

Hello guys, I'am a new trader and had a question since tax time is rolling around. First off I was curious how to calculate the Adjusted Cost Base for a futures transaction?

Say I want to calculate the ACB for 1 GC gold contract trade, what would be the proper way on doing so? With a Commission fee and exchange fee say of $5 total?

I am thinking I would have to take the contracts full price if purchased at $1400 an oz? so $140,000 for 100oz and just add the commission fees to this price minus the selling price for my capital gain/loss? I am honestly not 100% sure which is why I am seeking some help. I am going to seek tax advice next week for trading futures from a tax agent, but thought I could learn something from here first in case she is not familiar with day trading.

Thanks in advance.

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  #3 (permalink)
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DannyG View Post
Hello guys, I'am a new trader and had a question since tax time is rolling around. First off I was curious how to calculate the Adjusted Cost Base for a futures transaction?

Say I want to calculate the ACB for 1 GC gold contract trade, what would be the proper way on doing so? With a Commission fee and exchange fee say of $5 total?

I am thinking I would have to take the contracts full price if purchased at $1400 an oz? so $140,000 for 100oz and just add the commission fees to this price minus the selling price for my capital gain/loss? I am honestly not 100% sure which is why I am seeking some help. I am going to seek tax advice next week for trading futures from a tax agent, but thought I could learn something from here first in case she is not familiar with day trading.

Thanks in advance.

As far as I know, you don't need to figure out the cost base for futures. Just report G/L on this form:

http://www.irs.gov/pub/irs-pdf/f6781.pdf

oops, just noticed you are Canadian, so this doesn't apply to you. Sorry.

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  #4 (permalink)
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Thanks, yes I am Canadian. Are there any Canadian traders here who could help me out with capital gains/loss and superficial losses with trading? I have spent hours on google, I understand most of it but want to make sure I am calculating my losses and gains correctly.

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  #5 (permalink)
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Guys here is an example of what I am confused about. Say I take the following trades

February 4 Investment #1 - buy 1 MAR 10 CL contract for $90.00 a barrel and sell at $90.10 a barrel. Capital Gain of $100 - 5 fee, total capital gain is $95

February 5 Investment #2 - buy 1 MAR 10 CL contract for $91.25 a barrel and sell at $91.10 a barrel. Capital Loss of $150 + $5 fee, total capital loss is $155

So now the CRA tells me I cant report that as a capital loss and deduct it from my capital gains because I purchased the same contract type 30 days before or after the loss. So the rules on the CRA website says to add the amount of the superficial loss to the adjusted cost base of the substituted property. So is it correct now to add the loss to the first trade on February 4? Does this count as the substituted property? here is the link to their website discussing it.

What is a superficial loss?

I talked to another rep who told me you would have a gain on first trade and if you take no trades 30 days after the 2nd trade which was a loss, it will be a capital loss. but I am confused about the rule stating 30 days before or after the sale of the loss will make it superficial.

Any advice would really be appreciated.

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  #6 (permalink)
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You might try

https://futures.io/traders-hideout/4832-tax-thread.html

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  #7 (permalink)
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DannyG, any news on canadian ACB for futures transactions?

Hi DannyG,

I am also a Canadian who trades futures and am wondering how to properly include my costs, ACB, into my tax documents.

Did you get any clarification from the CRA or from other traders since you first posted this thread?

Thanks,
Cam

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