I am considering working for a prop firm and getting a k-1 at year end. Do I need to pay self employment taxes? Write offs? Retirement? I looked at greentrader and spoke to my accountant. Both are giving conflicting advise. Any one know? Thanks
What do you want it to be? It can depend on what you want, what you are trading and what the prop firm will actually do, whether or not they know what's correct. I'd suggest that generally if you are trading securities, using your initial capital and using the buying power of the prop shop, then you are a trader in the eyes of the DOL and IRS and you get a schedule K-1 with no self-employment income reported on it.