I thought I might bring this topic up for those that are considering being an at home independent trader using IB or another brokerage. http://www.irs.gov/businesses/small/article/0,,id=110413,00.html When you go from a job to being a career trader, then there comes "Estimated Taxes". Thats right, you send in a check for what is estimated to be owed to the IRS 4 times a year versus having money deducted from your paycheck or paying the difference once a year to the IRS. In essence, you can't simply just flip back all of your winnings back into the market. Money has to be set aside each quarter to send to the IRS. The problem with many of these very profitable journals is they do not take into account quarterly tax payments to the IRS. If someone makes 100 grand in a quarter then almost 50 grand needs to be turned over to the IRS. Its a complex topic, but basically, if you are a profitable at home trader then you can one day expect to write a check each quarter for what is estimated to be owed to the IRS. The consequences for not doing so are a fat penalty when you finally turn in your taxes. I am uncertain how institutions and hedge funds that engage in short term trading handle these matters or their tax status, but I am certain that some of these entities might have to crank out a check to the IRS every quarter.