Hi, what is my best option as far as tax laws go.

Discussion in 'Taxes and Accounting' started by Pooks, Oct 28, 2007.

  1. Pooks


    I have a job, I make about 50grand or so at my job. I also go to school etc..

    But what i really enjoy and want as my career is to trade.. I mostly daytrade at this point.. 1 trade a day or so.

    How can I save the most money when it comes to taxes? (i have stuff to write off, i bought a bunch of monitors, software, etc)

    I personally feel my trading is like my little business I am starting up.. and my job is there just to fall back on, and is something I want to get out of.

    Should I do my trades as Sole Proprietorship, LLC, or just keep it as personal income..

    Is there really any way to save substanitally on taxes?

    or has the IRS pretty much closed any loopholes that there might had ever been when it comes to trading?
  2. MeAgain


    hey tom nick how u doin :D
  3. Pooks


    I don't know who "Tom Nick" is.. but tnx for bumpin the post.. maybe someone who knows something on this subject will chime in..

    basic question is, any way to outsmart the IRS or no.. they got it all figured out lol
  4. A legit business expense isn't a "loophole" , it's a writeoff. Charts, data feeds, depreciation of equipment, home office, ect are all legal expenses. Use them.
  5. Surdo


    You do not need to create another entity to write off a few thousand in legitimate expenses. Itemize some on a Schedule A, and use a Schedule C for the rest. I highly recommend hiring an accountant, which is deductible next year, and will save you @ leas his fees and more.
  6. heypa


    You have to show the IRS by your documented past trading that you are actually trading as a business. Contact any tax attorney.:cool:
  7. Pooks


    tnx guys, very helpful stuff.
  8. rwk


    This is correct but may not be the whole story for every trader. I had a C corporation for my consulting, and I re-made it into a trading business. After a few years I analyzed my tax saving and the cost of running the entity (taxes, accounting fees, etc). I found I was spending $2 for every $3 saved. I concluded that it was not worth my time and effort to use an entity. Most accountants recommend claiming every tax benefit you can justify, but there can sometimes be a benefit to keeping things simple.
  9. Surdo


    If he trades every day, he can write off his computer and charts without doing anything fancy. His schedule "D" will document his trades.
  10. osok



    Give Rob Robinson a call at the CPA firm DiMaggio and Robinson.

    He is very good and very reasonable, in my opinion.

    He has helped me with stuff way more complicated than what you are talking about.

    Just say someone recommended him on the Elite Trader site.

    312 - 658 - 1002 extension #20.
    #10     Oct 29, 2007