If I, for tax reasons, turn my IB account into a LLC and a S-Corp, does that mean I have to notify IB and pay higher commissions and data fees?
Do you mind explaining how this helps with taxes? Options on e-mini futures are section 1256. 60/40 tax treatment. Mark to market at year end. If you make llc/s corp my guess is you are trying to draw a salary, which turns some / all of this 1256 income into ordinary income, subject to FICA taxes and taxation as ordinary income which I believe in all instances higher than 60/40. If you were a stock / stock option trader, this can totally make sense
Agreed with @qlai, your commissions should remain unchanged, but your data fees may change. However, if you trade exclusively on CME options on futures, keep in mind CME has a non-professional self-certification process which allows small business entities to remain considered a "non-professional", so if you were considered a non-professional before, there is a good chance that you'll still fall under the same conditions even if operating the same way except with a business entity.
Hey, thanks much! Will definitely look into it. I do wonder, though, if I don't do it (self-certification), what would the fee hit be?
Yes, some brokers will just have you sign an affidavit attesting that you are independent and only trade your own funds.
Correct. I traded thru a company and did not have to pay professional data fees. I gave a copy of the deed of incorporation of my company which mentioned that I traded only own funds. Never had a problem. I wonder what would happen if I would trade an account on my wife's name. Professional fees or not???