Im finally going prop in a couple of weeks after 9 years trading on someone elses dime. I was wondering what you guys do with excess profits. Assuming you have as much capital as you need, and your paying yourself, what do you do with the remaining profits? I assume there are certain risks in leaving unused $$$ with your B/D are there any tax benefits?. Do you hold the money in a personal account or set up a sub LLC account at a bank? Just wondering if theres a general practice here. Id appreciate any info.
Excess profits have been invested in: Real Estate (Huge writeoffs) Investment Grade Diamonds (not traceable) Collectible Gold Coins (not traceable) Foreign Situs (offshore accounts) use cashiers checks from currency exchanges farther than 50 miles from your home Cash Value Life Insurance (tax free) And my depreciating Collectible Cars :eek:
Real Estate Real Estate Real Estate Everything I make goes there. I own none of the property it all gets titled into a Family Limited Partnerships.
I like the call girl idea, but i dont have that much stamina. I was really wondering if I should open a separate bank account in my name as an individual, or establish a sub LLC and open an account or is there a way to do it using your B/D's name& tax id. I figured all you high flying prop guys must put it somewhere othere than loose women and exotic cars. If you take it from the B/D is it always classed as income and subject to tax or is there a way around that?
With excess short term profits I buy Tbills. Every six months a portion is swept into Muni's and TIPS so that the funds are laddered. I don't own investment real estate (been a landlord --- what a headache), stocks (been burned by news events and lousy tax treatment for short term gains/losses), mutual funds (pathetic returns).