Little progress has been made over the years to clearly define trader tax status, and some recent court cases are further complicating matters.

By failing to create clear statutory law on trader tax status, the IRS is leaving the matter to a wide assortment of tax court judges. Recent IRS tax court victories (Holsinger vs. Commissioner and Chen vs. Commissioner) are setting bad legal precedent for all non-hyperactive traders — especially part-time traders and money-losing traders.