Investors who bought and sold stocks within the year were hit with higher taxes than those investors who held on for the long term. Long-term capital gains rates are capped at 20 percent for those who hold investments for more than a year before selling. Hold for one year or less and you have a short-term gain. The tax rate for short-term gains is your regular tax rates, known in tax parlance as “ordinary” income tax rates.

Here’s how to avoid the same problems next April:

If you trade in your IRA instead of your taxable account, you’ll be relieved of both the tax-reporting and tax-paying problems. If you are a real mess when it comes to keeping track of your stock trading, an IRA is perfect for you. Gains or losses in an IRA are not reportable, so you don’t need any official records of stock buys and sells in your IRA. You should want to keep track of them anyway for your own portfolio management, but the IRS does not care what happens in your IRA as far as stock sales go, because these transactions have no current tax effect.

If you are a typical short-term trader, you are better off trading in your IRA. Outside of your IRA, short-term gains are taxed at ordinary income tax rates, but inside your IRA gains are all tax-deferred. At retirement, all distributions from your IRA will be taxable at ordinary tax rates — but that’s a ways off, and you would have paid that rate anyway, so it won’t cost you any more than you are paying now. Also, you only pay tax on distributions, so most gains can enjoy tax-deferred status.

Now you’ve solved both of your tax headaches. Next year at tax time, you won’t have to suffer with Schedule D reporting of stock transactions and you won’t owe tax on any gains within your IRA.

Even better. Use your Roth IRA

Consider trading in your Roth IRA instead of your traditional IRA. Gains in your Roth IRA also do not have to be reported and they will never be taxed. In order to receive tax-free status you must hold your Roth IRA for 5 years and until you reach 59-1/2 years old. You also never have to withdraw from your Roth IRA at 70-1/2, as you are required to do in your traditional IRA. If you never withdraw your stock gains in your Roth IRA while you are living, your beneficiaries will also be able to withdraw from your Roth and never pay income tax on those withdrawals.

Even if you are a long-term investor, and would only pay at a top capital gains rate of 20 percent, the Roth IRA is still a better deal. After all, 0 percent in taxes beats 20 percent any day. If you need to withdraw funds from the Roth IRA, withdrawals of contributions will always be tax and penalty free.