the IRS rules require that "Traders report their business expenses on Form 1040, Schedule C, Profit or Loss From Business."
Thus, the limit on investment interest expense, which applies to investors, does not apply to interest paid or incurred in a trading business. However, the commissions and other costs of acquiring or disposing of securities are not deductible but must be used to figure gain or loss upon disposition of the securities. Gains and losses from selling securities as part of a trading business are not subject to self–employment tax. How can a taxpayer make a Mark to Market Election? What is the tax treatment of sales of securities in connection to trading business?