If I have a long Position on Account A and then open short on Account B does it count as a close long for tax purposes? I gave my accountant the PNL for each trading platform account seperatetly and he was like “ok”, and then I asked “is that allowed cause PNL was calculated seperatetly for each account” and he was like “mhm, or you can also combine the trades and then calculate PNL if you want.” Then after he made me sign a form that say I have calculated the PNL correctly and their firm does not audit the PNL, I mean the PNL was calculated based on what he told me to do but I was pressured to sign. Like using the exchange rate for USD/CAD as 1.34, even though it shows mostly 1.36-1.38 on trading view in 2023, but the bank will likely sell USD for 1.34. I was actually gonna use 1.37 and I thought that was low but then he said through talking that I can use 1.34 so I use 1.34. My trading acitivity is consider business income. Hes CPA in Vancouver, but he said most of his clients lose money in trading so he can probably use any method to calculate PNL he wants most the time. I think when I ask him if hes 100% sure of these things through email he never reply cause of liability concerns.
I am certainly not going to second guess your accountant. He has more information than we do. You should change accountants if you would rather trust free information from the internet than your accountant.
I’m not sure whether a stock is going to go up or down, so I purchase 100 shares at $100 in account A and immediately sell short 100 shares at $100 in account B. I check a day later and the stock is trading down $10.00 per share. Account B is up $1,000 but account A is down $1,000. My PNL across both the accounts is zero, or I suppose negative after I pay any trade commissions or margin fees.
Unless I am a market maker I struggle to see this as the most efficient way of managing my risk. It would seem as sensible to apply the “coin toss” strategy in deciding whether to be long or short on a particular security. Either that or Las Vegas would have been much more fun.
From an accounting perspective; I would think that since neither trade was closed out at the end of the year, and your trading is being treated as a business that perhaps your long position in account A is inventory (asset) and your short position in account B is unearned revenue (liability). Thus, no realized income or loss.
As far as US exchange rates go; the average exchange rate for 2023 was 1.3497. If, however, you have actual data on the exchange rates in existence on both the purchase date and the sale date of every single purchase and sale it would be more accurate for YOU to make the accurate conversions and provide your accountant with the Canadian equivalent figures. I’m sure they would have used those rates.
I remember that morning I went off-roading and drove my truck through a mud bog before dropping it off at the garage for an oil change and lube. I couldn’t understand why my mechanic didn’t give my truck the attention I thought it deserved. I assumed customer service was his job. 
Easy tiger, there’s some really rough, lazy accountants out there. I have come across many designated others that could barely interpret a tax provision if it was written by Dr. Seuss. There are many practitioners such as myself that provide free information on the internet, it’s not always a bad thing.
Moving on … I mentioned in a similar topic discussion previously that a shorting position is a type of derivative, which is taxed as business income (there are other types of short derivatives that are not, but in this case, it is; because it relates to trading activity). The income would be taxed only when you close out the position, and yes, you can use the average exchange rate of 1.3497 to translate the P/L for tax purposes.
As for risk, trading is a one-way ticket to uncertainty. There are MANY various methods in managing risk when it comes to active trading (I say this from a CFA background), however you will find that it is a more philosophical approach to risk rather than a quantitative one. The odds are usually against you.
… and many years ago I learned the hard way that trading in certain derivatives, futures, and other contracts is a zero sum game. For every dollar of profit made by one party that same dollar must be lost by the counter party. 
even if its allowed that longs and short is not calculated to offset each other on different accounts, would intentional doing so trigger the GAAR rule (General Anti-Avoidance Rule).
For example if one have a 1 million unrealize profit long on Account A but instead of taking profit they open a short on Account B and then take tax free Margin Loans out of Account A using the long position as collatteral to spend their profits. Can CRA apply the GAAR to challenge these strategies?
@Deepinthemoneycall likely has considerably more knowledge here but off the cuff I would say it is unlikely that GAAR would apply. Presumably the short position is your choice of risk management for the long trade turning against you.
A margin loan is simply that, a loan. You are borrowing against equity, much like a business or individual may borrow against real property or other asset that has increased in value.
You will pay monthly interest on the loan, which, if you used the proceeds to purchase a decent Bugatti will not be deductible from your income. Margin interest could be a 100,000 per year non deductible cost to which you will need to find the liquidity to cover. At 10% interest it’s possible that after 10 years your million dollar profit may have been completely eroded with interest paid to the brokerage house.
If your security generates any kind of income (ie dividends) you will need to find the liquidity in account B to cover payment of those dividends.
Whether shorting a stock that you have a large gain on is a good risk management strategy to lock in your gain is up to you as the investor to decide. Borrowing against that gain and paying margin interest to supplement personal living is another personal decision. I don’t see where you are going to generate the cash flow to pay interest on the loan.
At some point in time your positions will need to be closed out. Either you will make a conscious decision to liquidate the positions or if you never make that decision the Canada Revenue Agency will make it for you in year of death. At that point in time any gains will certainly be triggered.
Speaking of what some might call crazy investments… Costco is selling up to $200 million per month in physical gold and silver for about 2% above spot. They sell out as soon as the weekly delivery arrives. 
GAAR (also called Section 245 of the Act) is not “Triggered”… it is the CRA’s fishing net that allows them the flexibility to catch transactions that they deem have the capability of, or were intended to avoid other subsections of the act by both the nature of, and the function of the transactions.
Offsetting shorts and longs is not advised. That being said, there is nothing in the act that states you can’t do it. Only from a financial reporting perspective is this generally disallowed. It’s a grey area that lies in the hands of the investor, and CRA will look towards the nature of the transaction and whether or not you intended to avoid a profit is the question that is being asked.
@snoplowguy has a strong point to consider in that CRA will look towards the nature of the short as being a type of loan, while the function of the transaction for income tax purposes roots from a business perspective (meaning your income should be taxed as business income, and your loan is not capital in nature)… as I’ve mentioned in previous threads.
Sorry folks haven’t been too active this week… busy with the upcoming deadline!
Aha! That must be how those guys laundered that gold from the Pearson heist! 