Tools of the Trade

[owend]

I am not yet facing Bankruptcy(see my other post) But I am curious of something.
Tools of the Trade. If you are a Stock Trader would the money you used too run the business be consider tools of the trade?

[justbroke]

Cash is not a tool of the trade. A computer, calculator, desk, books on investing... may be tools of the trade. Otherwise everyone would just claim to be a stock trader/broker. I tried to get the definition from Black's Law Dictionary (the preeminent source), but here's one from Collins: "The tools of your trade or the tools of the trade are the skills, instruments, and other equipment that you need in order to do your job properly."

So instruments, skill and equipment. Not cash.

Additionally, most states have limits on how much of trade equipment can be protected through the exemption statutes. I believe the Federal Exemption is only about $6,000 (I may not have the current or correct value).

[bcohen]

"Tools of the trade" refers literally to tools and equipment needed to do your job. For example, I work in heating and air conditioning, so my hand tools, power tools, and refrigeration tools would be considered "tools of the trade". If someone is a professional auto mechanic, their "tools of the trade" would consist of their wrenches, sockets, test equipment, measuring instruments, etc. For you, as a stock trader, your computer, printer, office furnishings, and things of that nature could be claimed as "tools of the trade".