eToro Issues Update In Response To IRS Regarding PTPs for Non-US Traders

eToro, an online broker, has released an update on publicly listed partnerships (PTPs). Non-US customers will no longer be able to trade the underlying assets of Publicly Traded Partnerships (PTPs) on eToro.

This adjustment is being made in response to the IRS's new Internal Revenue Code Section 1446(f), which takes effect on January 1, 2023. It has an influence on the revenues from the sale of PTPs owned by non-US tax residents.

All sales become subject to a 10% withholding tax. This withholding tax implies that if you close a $10,000 position, even if no profit is earned, you will be subject to a $1,000 withholding tax. As a consequence, you would get $9,000 in compensation.

Due to the tax responsibilities of retaining and managing these assets, eToro will no longer provide 'real' investments in PTPs. The business requests that you close any open real holdings in PTPs before the end of the market on December 26, 2022.

If the aforementioned conditions are not met, eToro will liquidate any (relevant) remaining shares on December 28, 2022.

Existing roles have been reclassified as *Close Only*. *Close Only* indicates that new 'BUY' positions on the underlying asset cannot be opened, but current ones may be closed. Users who want to acquire exposure to PTPs will still be able to do so by opening CFD positions.

About eToro

eToro provides an innovative trading platform that is distinguished by a one-of-a-kind social trading experience. Users may study and mimic the trades of more experienced investors for crypto, stock, and ETF assets using eToro's social trading network. The platform shines with an easy-to-use website design that allows investors to readily choose traders to follow or rapidly make their own trades on the platform. eToro is available in over 140 countries, demonstrating the platform's capacity to appeal to a wide spectrum of consumers.

However, eToro is not accessible to investors in all states in the United States. Despite the fact that eToro has recently released an app for options trading for US users exclusively, its platform still lacks many of the tools and features seen in more complete trading experiences, limiting the site's utility to more skilled investors. The service is best suited to traders who desire a social and crypto emphasis, but those looking for more will likely find rival online brokers more suitable.

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