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Tax status as Daytrader
- Thread starter The_Z
- Start date
A site I found helpful:
http://www.fairmark.com/traders/benefits.htm
http://www.fairmark.com/traders/benefits.htm
You do not need a LLC or any type of corporate shell UNLESS you are trying to accomplish very specific things.
What you do need to do is two things to start.
1st) Educate yourself at least a little. Then take $1000< and rent yourself some professional advice and see if its even practical to claim trader status. Consider it tuition. The IRS doesnt take too kindly to turning on/off trader status like a light switch. Its not a elective without consequences.
2nd) Realistically consider the need after educating/consulting on your own. There is ZERO need for trader status unless you have consistently been making $$$. If you have not made 50k each year for the last 3 years, forget it. Work on that task first and keeping your trading costs as low as possible. 50k is a generously low figure.
3) Forget that nonsense of domiciling in Nevada or Delaware to evade state tax. Work on becoming very wealthy and then hiring a tax lawyer/law firm rottweiler of your own to take on the IRS and live where you choose.
In short, hone your trading edge then get professional advice to keep as much as your profits as possible.
After that you can look into expatriation. Lol.
Good luck.
What you do need to do is two things to start.
1st) Educate yourself at least a little. Then take $1000< and rent yourself some professional advice and see if its even practical to claim trader status. Consider it tuition. The IRS doesnt take too kindly to turning on/off trader status like a light switch. Its not a elective without consequences.
2nd) Realistically consider the need after educating/consulting on your own. There is ZERO need for trader status unless you have consistently been making $$$. If you have not made 50k each year for the last 3 years, forget it. Work on that task first and keeping your trading costs as low as possible. 50k is a generously low figure.
3) Forget that nonsense of domiciling in Nevada or Delaware to evade state tax. Work on becoming very wealthy and then hiring a tax lawyer/law firm rottweiler of your own to take on the IRS and live where you choose.
In short, hone your trading edge then get professional advice to keep as much as your profits as possible.
After that you can look into expatriation. Lol.
Good luck.