WHat happens to old carry over losses on capital gains if I go MTM?

==========There is published IRS guidance on when you need to make the election. I believe that you're too late for 2013, but consider it for next year.

Capital losses carried forward are from PAST YEAR transactions. The Mark-to-Market election only affects CURRENT YEAR transactions. This means that your capital losses will continue with [up to] $3k (or $1,500.00 if married filing separately) being used each year until it is gone.

tax year). First when and how do I need to file?

See page 71 of Publication 550. Your deadline for a 2014 election is 4/15/2014.

Phil Marti VITA/TCE Volunteer Clarksburg, MD

In trader status, you can identify stocks you want to hold for investment on which you get normal long-term capital gain treatment.

BEGIN QUOTE tax topic 429

As with dealers, a taxpayer may be a trader in some securities and may hold other securities for investment. The special rules for traders do not apply to the securities held for investment

END QUOTE

So the carryover losses would apply to the stocks held for investment, and if you have none then you get the up to $3k loss per year.

You may be rejected for trader status if it is merely part time as the tax topic says "The extent to which you pursue the activity to produce income for a livelihood" is a factor. But you can be a part time trader -- just there may be rules around it.