Hi, Does anyone have experience with transitioning from being an individual trader to trading through a business entity? I am an options seller, both futures and stocks/etfs options. Will creating a business and trading through it be a better way to trade? Please advice. Thanks in advance.
1) There aee already a number of threads on this. Try searcing on corporations or LLCs 2) The major value of a corp/LLC is liability protection. This is useless to you in trading 3) Corps/LLCs add a number of annual expenses and complexities to your life. 4) People keep floating how you can do retirement , medical and other things through a business. For most people, you can do that anyway without the additional baggage. The best way for most people I have seen, is to be "unemployed" on your tax return and report cap gains/losses in the appropriate places...
joepaterno has no experience and just likes to post corps add quite a few things 1) ability to transfer your assets to your children or friend or partner just by issuing shares. or signing over the company 2) ability to have investors or partnerships, issue shares for the amount he invested (expandbility) 3) audited company track records, nobody cares about your personal record 4)most important an organization of multiple partnerships into one entity of force, the main reason for a corporation.
joepaterno has owned a corporation and cooolweb is still trying to work the kinks out so he can risk starting to paper trade. A few reads of his "threads" will make it very clear. As you can see from his #1-4, he cut and pasted out of his Phoneix University economics book, did not understand your question, and had absolutely nothing to say related to your post.
Thank you both for the replies. But, if i don't have the need to establish a trading record, and if I just want as 'hassel-free' aw ay as possible to report my gains and pay my taxes, what would you guys suggest? Is it possible to file taxes as unemployed and still count the commissions as an expense etc.? Thank you.