Ok, so I have some forex losses this year and in preparing my tax return in Turbo Tax I came across this irc 988 and irc 1256. From my research, i understand the default is to report any gains/losses under irc 988 unless you opt out of it into irc 1256 to take advantage of the 60/40 (assuming you have gains). Well, I have losses, so it would be more beneficial for me to report them under irc 988 as the losses are not limited to $3000 as they would be under irc 1256 (i have greater than $3000 in losses).

My issue is that I wasn't aware of irc 988 and irc 1256 last year and I had losses (greater than $3000) LAST year which i reported on form 6781 under 1256 contracts which limited my losses to $3000. Now i'm learning that I THINK I could have put them on line 21 on form 1040 and netted the entire loss against my ordinary income. So, my questions are:

1. Can I amend my 2007 tax return to report them under irc 988 instead of 1256, and if so, how do I amend it?

2. I'm reading thta you're supposed to determine beforehand if you are going to elect under 988 or 1256 before you start trading FX, and send yourself and INTERNAL memo stating which one you want to elect under. But I was not aware of these tax codes before trading, and just learning them now, so what can i do about that in regard to amending my 2007 tax return (if i am even able to)

3. For this year's return, can I just exclude form 6781, and just put the losses on line 21 of form 1040? Do i need any supporting documentation? I do have a 1099-b, so the IRS should have that info too right?

Any help would be appreciated. Thanks!