One thing to consider is that MTM doesn't just eliminate long-term capital gains treatment - it also affects wash sale rules. With MTM, wash sale restrictions don't apply to you anymore, which can be a huge advantage for active traders who frequently trade the same securities. Last year, I had significant losses that were disallowed due to wash sales. If I had MTM status, I could have claimed all those losses immediately. Just something else to factor into your decision.

As someone who went through the MTM election process last year, I want to emphasize how important it is to get professional guidance on this decision. The tax implications are complex and can significantly impact your overall tax liability. One critical point that hasn't been fully addressed - if you're considering MTM for 2025, you need to make that election by the due date of your 2024 tax return (including extensions). You can't just decide mid-year in 2025 that you want MTM treatment. Also, regarding your NVDA shares - the previous comment about them being "marked to market" at year-end 2024 is correct. Any unrealized gains on December 31, 2024 would be treated as if you sold and repurchased them on January 1, 2025. This is called the "deemed sale" rule. For your specific situation with substantial NVDA gains, I'd strongly recommend running the numbers both ways - selling in 2024 to lock in long-term capital gains treatment versus keeping them and having them converted to ordinary income under MTM. The difference in tax rates (0%, 15%, or 20% for long-term capital gains versus up to 37% for ordinary income) could be substantial depending on your income level. The entity structure option (LLC/S-Corp) is possible but adds complexity and costs. You'd need to ensure proper business purpose and substance, maintain separate books and records, and the entity would need to qualify for trader status independently.

Make sure you actually have access to transcripts first. Had to verify my identity through id.me before I could see anything

Been there! Usually takes 5-10 business days for transcripts to update after e-filing, but can be longer during busy season. Since you got your acceptance confirmation, you're all set - just gotta wait it out. The transcript will show "N/A" until the IRS processes everything. Try not to stress too much, the waiting is always the hardest part!

Has anyone else dealt with capital loss carryforwards while living outside the US? Im in a similar situation with losses from 2023 stock sales, but im also wondering if the standard deduction comes into play here at all?

I've been through a similar situation as a non-resident with capital loss carryforwards. One thing to consider is that if you truly have no US source income and no filing requirement, you might want to skip filing the 1040NR this year to preserve your full $3,000+ in losses. The key issue many people miss is documentation. If you decide not to file this year, make sure you maintain detailed records of your last filed return that shows the capital loss carryforward amount. When you eventually have US income again (from IRA/HSA withdrawals as you mentioned), you can pick up the carryforward from your last filed return. I'd recommend consulting with a tax professional who specializes in non-resident tax issues before making this decision, since the stakes are high with preserving those losses for when you actually need them. The $3,000 you'd "waste" this year could be valuable when you're dealing with early withdrawal penalties later.

The interaction between Section 1231 gains and partnership basis is complicated. Here's what you need to know: your basis in a partnership is adjusted by your share of partnership income (including section 1231 gains), but that adjustment happens AFTER those gains flow through to you. In other words: 1. Section 1231 gain flows to you via K-1 2. You report that gain on Form 4797 3. Then your basis in the partnership increases by that gain amount So your GP is totally mixing up cause and effect here.

I'm dealing with a very similar situation right now with an inherited partnership interest from 2020. My GP also tried to tell me that Section 1231 gains "already account for basis" which made no sense to me either. After reading through this thread and doing more research, I found that IRC Section 742 specifically addresses basis of transferred partnership interests, and Section 1014 covers the stepped-up basis for inherited property. These sections make it clear that you get a stepped-up basis equal to FMV at date of death, completely separate from how the partnership calculates Section 1231 gains on its assets. I ended up getting a professional appraisal of my partnership interest as of the date of inheritance. It wasn't cheap ($2,500) but it gave me defensible documentation for the IRS. The appraiser used discounted cash flow analysis based on the partnership's real estate holdings and debt structure. One thing that helped me push back on my GP was citing Treasury Regulation 1.704-1(b)(2)(iv)(l), which requires partnerships to maintain capital accounts but clarifies that capital accounts are NOT the same as outside basis for tax purposes. Your GP seems to be confusing these concepts just like mine was. Don't let them push you around on this - you have every right to proper documentation of your inherited basis.

Don't forget about IRS Publication 551 which specifically covers "Basis of Assets" - it has examples for different scenarios. The most important thing to remember is that distributions from rental activities typically aren't affecting your basis the way you might think. For regular rental income: 1. Rental income doesn't reduce your basis 2. Rental expenses don't increase your basis (except capital improvements) 3. Depreciation DOES reduce your basis 4. Money you take out of the rental business doesn't affect basis This is different from partnership distributions where distributions can reduce your basis. Are you operating this as a sole proprietor or through an entity? That makes a big difference in how basis is calculated and tracked.

I'm actually dealing with this right now for a property I sold last year. One tip nobody mentioned yet: KEEP EVERY RECEIPT for improvements! I mean everything. New roof? Keep it. New appliances? Keep it. Even small stuff like cabinet hardware adds up. When I sold my rental last year, I was able to add almost $67k to my basis from improvements I made over 8 years. That significantly reduced my capital gains tax. I used a simple Google Sheet to track: - Original purchase price - Plus: Improvements (itemized by date) - Minus: Depreciation taken each year - Equals: Adjusted basis at time of sale The IRS allows you to include closing costs in your basis too! Don't forget those.