In general, the mark-to-market election must be made by the due date (not including extensions) of the tax return for the year prior to the year for which the election becomes effective. The election is made by attaching a statement either to your income tax return or to a request for an extension of time to file your return. The IRS is very particular about this election and in only a few very rare instances have they allowed a late mark-to-market election to be filed. See our trader tax court case summaries for further details on denied mark-to-market elections even under compelling circumstances.