commodities trader
(5) Special rule for options dealers and commodities traders (A) In general Subsection (a) shall not apply to transactions— (i) of an options dealer in the normal course of the dealer’s trade or business of dealing in options, or (ii) of a commodities trader in the normal course of the trader’s trade or business of trading section 1256 contracts. (B) Definitions For purposes of this paragraph— (i) Options dealer The term “options dealer” has the meaning given such term by section 1256(g)(8). (ii) Commodities trader The term “commodities trader” means any person who is a member (or, except as otherwise provided in regulations, is entitled to trade as a member) of a domestic board of trade which is designated as a contract market by the Commodity Futures Trading Commission. (C) Limited partners and limited entrepreneurs In the case of any gain from a transaction recognized by an entity which is allocable to a limited partner or limited entrepreneur (within the meaning of section 461(k)(4) ), subparagraph (A) shall not apply if— (i) substantially all of the limited partner’s (or limited entrepreneur’s) expected return from the entity is attributable to the time value of the partner’s (or entrepreneur’s) net investment in such entity, (ii) the transaction (or the interest in the entity) was marketed or sold as producing capital gains treatment from a transaction described in subsection (c)(1), or (iii) the transaction (or the interest in the entity) is a transaction (or interest) specified in regulations prescribed by the Secretary.