LLC tax return

Discussion in 'Taxes and Accounting' started by SideShowBob, Jan 30, 2007.

  1. I started an LLC last year with my father, elected MTM for securities only, and traded 90% futures.

    I'm getting ready to file an LLC return -- from what I understand it's a partnership return (for a multi-member LLC) which passes through gains/losses.

    My question is -- are there any "gotchas" for filing the return? The LLC made about 40 stock trades (mostly in December when I started trading a new system for equities) and around 1000 futures trades, most not held overnight (the longest holding period for a future was about 6 days).

    I'd like to avoid paying $1500 to a CPA when it's mostly single line item futures trades, but on the other hand I want to make sure the LLC gets trader status.
  2. lwlee


    Get Green's book. I am going through it right now. In addition if you get his "gold" package = $99. You get access to website that has sample tax returns.

    As I understand it, trader tax status is not something you file like MTM. You have to know if you qualify by your trading activity. Looks like you qualify.
  3. I believe if you are trading via a LLC or Corporation. It is already MTM. A corporation doesn't have to apply for trader status.

    One thing regarding trading under your LLC. You have to pay fica tax (an extra of 15%) for your profit as a managing member of the LLC.
  4. I read Green's book awhile ago, I guess I better dig it out. As an entity, you're saying the LLC doesn't need to worry about MTM or trader status-- I can automatically deduct LLC expenses?

    As for FICA both members also have other jobs which take care of a lot of our FICA, so we're only paying the 15% on the difference.
  5. I believe you still have to pay half of the SS, even you pay SS with your other job.

    In the following thread, there are some info regarding LLC.

    Post questions there. Perhaps traderstatus can give you more insights.