How Traders Use LLCs to (Legally) Save $69,000/yr on Taxes

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Комментарии : 274

@BasicFolders 3 месяца назад

THIS IS AWESOME!! This is one of the subjects that's barely covered on RU-vid... at least to the extent that it deserves. Thanks for this! ❤

@jordanodonnell7807 2 месяца назад

Dont forget there is Rule 72(T), which allows you to take contributions before 59 1/2, but you must make them on a consistant basis that is approved by the IRS. So to get contributions for $3,000 a month with a seven figure account, would totally be do-able before 59 1/2.

@tootory9506 3 месяца назад

We asked, and you delivered Ross!! 🥳 Thank you so much for this more in depth explanation on tax and saving. This is a great episode. I'll watch it five times.. And hope you make more like this!

@skillet3753 3 месяца назад

Saving this video for 3 years later when im finally profitable😅

@samuelmayo6566 2 месяца назад

Me too.

@The.Harsh.Truths Месяц назад

Newsflash. You’ll never be profitable. 95% of retail traders lose money. But keep giving this guy views.

@tonyfu7695 Месяц назад

That’s an ape there!

@JovannyLazaro Месяц назад

After 4 years now I need to learn how to pay less taxes legally

@keyjuan7 20 дней назад

@@The.Harsh.Truths why can't he be the 5%? Go doubt yourself in a corner.

@GoldenEagle7 3 месяца назад

Thank you so much Ross!! This is what I looking for in details ..Really no one giving these info like you doing as always .God bless you !!

@Giggidygiggidy12 2 месяца назад

The other issue I didn't hear him mention is a brokerage will make you regoster as a professional trader if you try and setup your acct as an LLC or corp. Even if you are a newbie which means your trading fees are going to quadruple every month. So you better be making some serious profits before you do that or your going to be spending a whole lot on expenses if you are unprofitable

@zeusinferno1223 2 месяца назад

😮😮😮😮

@MR.Cameroon1993 Месяц назад

Thats why I havent incorporated myself

@archetype1987 3 месяца назад

Thank you, Ross for touching the subject. I have been searching for a detailed explanation. This is amazing. No other video I have seen on the Internet covers it this way.

@ukobassey2517 3 месяца назад

Genuinely appreciate your help with this 🙏

@dejayvanhorn8685 3 месяца назад

Thank you so much Ross for sharing your knowledge and wisdom. Much appreciated

@biggcurv87 3 месяца назад

Thank you so much for the info you shared 🎉👊👊

@cybermiketrading 3 месяца назад

Needed this, thank you brother. This is phenomenal information 🔥

@davyjones9595 2 месяца назад

Very interesting thanks for the advice. The problem is finding a CPA that actually knows the code for traders

@BIGCAT-1985 2 месяца назад

Thank you for sharing. Love this video!!!

@davidgutierrez1319 3 месяца назад

Yes! Thank you for sharing your knowledge ross

@bsfreak697 2 месяца назад

Much needed content, thank you!

@Cooldadkev Месяц назад

Thanks Ross love the video well explained!! Thank you 🙏

@JWnFlorida 3 месяца назад

Great information.. Great share.

@dr.tonyratliff8558 3 месяца назад

Awesome information. Thanks

@gregstertrades 3 месяца назад

Awesome video-great info- thx. Ross

@dakel7 3 месяца назад

This is great info, thank you!

@rramach9091 2 месяца назад

Thank you so much. Very helpful

@DarkBullCapital 3 месяца назад

awesome info

@Michael_English87 3 месяца назад

I've been waiting for this video Ross!

@MrJupton1 2 месяца назад

Efing Great Video! Great Info Ross!

@bradclark2922 2 месяца назад

There are much more deductions for an S Corp besides the things Ross mentioned, great video by the way. Your vehicles can be purchased (company vehicle) in the corp and completely deductible, including gas, insurance, tag, etc. Also, you can depreciate the vehicles for a further deduction. Corporate officers are also allowed a housing allowance, meal allowance, some entertainment allowance, etc. You don't have to be rich to pay little or no tax, you just have to do your research and be smart about it.

@phyllisfeliciano5883 Месяц назад

Thank you

@cody0006 Месяц назад

that was extremelly informative thank you for sharing

@shyamvai Месяц назад

Wow

@tomlorenz4344 Месяц назад

If you work from home as a trader, a company vehicle will be highly scrutinized. Expenses must be reasonable for the particular business.

@bradclark2922 Месяц назад

@@tomlorenz4344 Not anymore. The Chevron doctrine was just overturned by the Supreme Court. It's no longer up to the agency for interpretation. If it's allowed by the tax code, then so be it.

@Mufuka314 2 месяца назад

Love your channel, man. Helps a lot

@CR-dp2qg 3 месяца назад

Muchas gracias!!!! Great information!!!! Thank you

@pedropablopimientaperez96 3 месяца назад

Great info Ross!

@jstreett1 3 месяца назад

Awesome video! Thank you!

@deleongirl72 3 месяца назад

THANK YOU 🙏🏼 for covering this topic in trading. Will save it for when I get there 😊 sharing it with others.

@bryonseilerXauBry0716 3 месяца назад

Okay. You earned another subscriber😊

@METSHAYQ21 3 месяца назад

Thanks Ross for the awesome video. Could you please do another video on how to trade with IRA account?

@IamFluffY90 3 месяца назад

Ross has been looking at my search history... I was literally looking up trading as an LLC vs S-Corp last night

@johnnydominos 3 месяца назад

Ross, it's 59 1/2 and you must have the roth ira for 5 years. good info, thank you.

@anishjariwala2584 Месяц назад

amazing- THANK YOU

@headlibrarian1996 2 месяца назад

The paperwork for LLC brokerage accounts is really annoying though. Far more intrusive than for personal accounts. Can’t really do it online, actual paper is required, with wet signatures. They want photos of your driver’s license even though they don’t for your personal accounts. Business checking accounts are the same way. You will pay substantial fees for market data too. Worth it in the end, but be prepared for it.

@Ryanj8031 22 дня назад

Took weeks to get approved for my futures account for my LLC. They asked for everything but my first born lol

@blockchaindomain 3 месяца назад

now... if only I could make 100k a year instead of loosing it... LOL....

@Rainy_Day12234 2 месяца назад

If you trade futures you’re taxed at 60% longterm capital gains rate and 40% short term rate…up to top marginal tax rate.

@apoc1211 2 месяца назад

Help

@snuff43 3 месяца назад

Great video. Does qualifying for Trading Tax Status change the type of entity?

@ekdmes 3 месяца назад

Thank You ❤

@phyllisfeliciano5883 Месяц назад

Thank you

@MK-oq7ib 10 дней назад

Super strategy!

@shivaduvvuru 27 дней назад

Very good planning. I am a tax and financial planner/ CPA and I am in all support for this.

@TheYungsimba21 Месяц назад

God bless you !!!

@RislinMLG 3 месяца назад

One thing to be csreful of here is that the amount you can contribute to the solo 401k is based on your overall compensation. You can generally only contribute up to 25% of your salary. So actually in your example of a 50k W-2, you can only do an employer match of 12.5k. However, you can do employee deferrals on top of this.

@headlibrarian1996 2 месяца назад

After tax contributions can be 100% of W2 box 1, or the annual limit, whichever is less.

@shyamvai Месяц назад

Deferral?

@headlibrarian1996 Месяц назад

@@shyamvai "Employee deferrals" are what the tax code calls 401k contributions by paycheck deduction.

@JohnMCPA Месяц назад

Careful differentiating S Corp election for a C Corp vs S Election for an LLC. They are the same. However, a single member LLC that does not elect S must file on Schedule C of the 1040 personal return which would be subject to the 15% SE tax. Also Lots of people think incorporating in a particular state can be state tax favorable. Unfortunately, the income is supposed to taxed in the jurisdiction in which it was earned... A K-1 distribution from an S Corp is taxed at your normal earned income rate when it flows through. Generally, you have good ideas; we just need to be sure to continue to protect the public which you did nicely by recommending many times your listeners seek a qualified CPA. Good stuff! Love the 401k and Roth ideas! (Also look up setting up a living trust and using a "back door 401k"

@sumitomoO0O Месяц назад

Do you have any tips for W2 earners whose primary income is w2 but they also make trading income close to the w2 income? My w2 income makes me ineligible for roth IRA account, so that option is off the table.

@TeamMadcrew 25 дней назад

@@sumitomoO0O open a traditional ira for trading.

@TraderChick 29 дней назад

No RU-vidr talks about this and it’s so important. Is a schedule K hard to do? Keep these tax videos up please 🙏 thank you Ross! Congratulations on your success :)

@MrJupton1 2 месяца назад

Not sure, but something to considered.... A "full time trader" under I R S classification have to meet certain requirements. IE Number of trades etc... Worth checking out before declaring sub chapter S status and being able to deduct biz expenses. If you don't meet their requirements deductions and biz expenses are a mute point. Just saying Worth verifying

@TeamMadcrew 25 дней назад

i'm classified as a full time trader (trader tax status), sole proprietor . if you don't want to worry about qualifying, then corporation is the best option.

@elliotthall5543 2 месяца назад

HA! For a minute I thought you went British on me. It took a minute to get the gold reference. I'm sharp like that. HAHAH.

@LD32. 3 месяца назад

wow Ross, THANK YOU

@katomane6116 2 месяца назад

Great explanation 2 mins in and I finally have my answer . Just pay regular taxes at the end of the year until I make too much money 😂 thanks

@jaro2450m 3 месяца назад

And you got a new subscriber and thumbs up

@dakel7 3 месяца назад

Do we need to file for Day Trader Tax status in the S corp? Or is just setting up the S corp all I need to do. Also did you do the S corp in Delaware?

@RTRT-jr8jv 3 месяца назад

Great info, thank you! Is the level of asset protection the same for S-Corp and LLC or is one better than the other?

@DaytradeWarrior 3 месяца назад

With an escort, the income flows through to your personal tax return. With a s corp, the corporation would pay income tax on its profits if it has net profits and then you would also pay your taxes as an employee so you could have double taxation.

@VisionClearly 2 месяца назад

Should that say, "with an LLC" instead of "escort"?

@BrettM2014 3 месяца назад

Are you able to depreciate the equipment over several years or just the year the equipment is purchased?

@SBayne762 Месяц назад

This is a great introduction to the various facets of taxation for people that undertake the difficult profession of trading. No matter what though, remember it is not a viable defense in an audit situation to say, "But Ross said so!" Please people, consult a licensed tax professional and understand that the IRS (through legislation and voluminous legal precedent) ultimately hold you responsible for your own tax return. Rock on!🤟

@peterhaywood4111 3 месяца назад

If i hadn't subscribed previously (actually I had) I'd certainly subscribe after this episode. Many thanks!

@true.fame. 2 месяца назад

this is GOLD!!!

@ciacasupreme 2 месяца назад

🙏🏿 thanks

@tomlorenz4344 2 месяца назад

Too much hand waving for me. That home office expense as described will almost surely trigger an audit, plus it’s a highly bloated number. IRS will give you a standard deduction of $5/sq ft with 300 sf max, for a total of $1500. If you itemize, you can deduct up to 15% of the home expenses. Unless home expenses are $80,000 that $12 grand will look fishy. The $50,000 salary will still need to have the 15.3% social security and Medicare taxes paid one way or another. Also here in Florida we don’t have a personal income tax, but there is a corporate income tax of 5.5%. The one thing that might made sense is the solo 401k. Even then the 15.3% SEP must be paid on the employee part of the contribution. Even then, taxes are only deferred not avoided. Money taken from a 401k is taxed as ordinary income, whereas in an ordinary trading account there’s the opportunity for much lower long term capital gains tax rates. Also states often charge an annual fee just to have an LLC or corporation. In Florida it’s $150. Then there may be other local fees and license costs as well.

@sumitomoO0O Месяц назад

@tomlorenz4344 Месяц назад

@@sumitomoO0O make sure to hold investments long right to have them taxed at the long term capital gains rate. Buy growth stocks that don’t pay dividends and hold them until your retirement and are in a lower tax bracket

@r.c.3744 2 месяца назад

Great video thank you!! Do you have a video on how to setup a scorp for traders?

@DaytradeWarrior 2 месяца назад

That is a better question for a CPA.

@vBabywipes 3 месяца назад

hey ross! how much do you need to make annually for it to be worth creating a llc/scorp or how long would you need to be consistently profitable? im on the verge of profitability and want to make sound financial decisions

@FaignDaeth Месяц назад

Title: LLC. Video: S-corp 😂

@c0t556 Месяц назад

Thanks for the great video! Can I also deduct tax if I use my LLC or S corp to pay medical insurance for myself as an employee?

@johnthomasii943 3 месяца назад

Great video! Can I still get a 2 week trial?

@allanultimate 2 месяца назад

Hey ross im new to your channel but im wondering if you could go over this information but trading with a Prop Firm under an LLC, could this still work under that ?

@Overland_Story 3 месяца назад

What the app should I use for set up?? Quick books, ADP? Or maybe other applications? Thank you

@TheFilipinoChannelinU.S 2 месяца назад

Hi Ross, do they need receipt for expenses in taxes?

@TradeItUntilYouMakeit 3 месяца назад

Whats leftover to keep in your account to compound growth if its all taken out?

@katomane6116 2 месяца назад

Bro I don’t know who cooked harder , you or Kendrick 😂 🔥🔥 thanks for sharing.

@evalsgpar6840 2 месяца назад

This should’ve been your first tutorial video

@timreynolds2264 3 месяца назад

In the s corp pays you a salary, does it count as real income so you can pay medicare, ss? That will give you ss and medicare. There is a roth 401k?

@uniquecintron3119 2 месяца назад

So you start the s-corp but your trading isn't profitable how do you assign s salary when it's in the red

@Z.H.Trading 3 месяца назад

Thanks again great video! So, are you thinking when you reach 59 1/2 you trade fully out of the ROTH IRA and just money for cost of living, etc.? Then just collapse your S-Corp? Good stuff man thank you

@DaytradeWarrior 3 месяца назад

At that time I might help grow my children’s accounts or do something like that.

@Z.H.Trading 3 месяца назад

@@DaytradeWarrior Great idea man. I'm a couple years away and making "okay" progress. 80% green days even small, so will start following the guidance for the ROTH and start building that out for retirement "help" in a few years. Bad choices from the start so really no retirement - I feel I have a light at the end of the tunnel. Thanks again

@certifiedfinest5065 3 месяца назад

Can we do vehicle purchase deduction used for driving to store for office supplies etc?

@FrostyPumpernickle 3 месяца назад

How much do I need to gross from trading to create an LLC? I was chatting with a close friend in my trading group about creating an LLC to trade under

@billydanzz 3 месяца назад

IRS Section 1256

@StevenStawiarski-sb1bx 2 месяца назад

Why not a Roth IRA? You can trade futures like the emini contract but you do it through a custodian, no taxes on earnings

@RealPhilTrades Месяц назад

Ross, thanks for the awesome video. I'm always wondering how much trading I should do before I start, or if a minimum number is required. Obviously, if I make $1000 a year and write off $10,000 in expenses, something is off. I'm slowly becoming more and more profitable and I'm not sure when to make this leap. Thanks in advance to anyone who comments.

@Firemedic2105 3 месяца назад

Personally I did a pass through LLC and realized that they make me pay professional market fees and that killed my profits!!! Once I consistently make good money it's good, but I went back to trading outside the LLC and filed mark to market this April.

@certifiedfinest5065 3 месяца назад

Does mark to market allow for the same deductions an LLC would?

@Firemedic2105 2 месяца назад

@@certifiedfinest5065 sorry I just saw this. Yes it does. The key is filing before the April 15th deadline... which I didn't know to do when I first started trading.

@Romariobruno245 2 месяца назад

Please what broker or platform i can use unided states after i get my s Corp.

@michaelferreira2651 3 месяца назад

If you use S corp, can you use MTM accounting even if you don’t qualify as trader by IRS?

@Lee-u2i 16 дней назад

Ross should have mentioned moving to Puerto Rico where you don't pay tax on capital gains

@galactic25 3 месяца назад

Also, what I see is that you can take the home office and other related expenses if you are a 475f marked to market trader. Why do you say you need a business entity like s-corp/llc for this reason?

@YaSoFine 3 месяца назад

QUESTION: Ross, Great Video but how to overcome the higher amount of data fees charged by brokerages once you establish a entity trading account (corp). The data fees (level 2 etc) is small or free for individual trading account but for a entity trading account brokerages charge nearly $1000 a month for the same data. HELP!

@shyamvai Месяц назад

Wouldn’t that be an expense that you can write off too?

@brandonnguyen1486 2 месяца назад

Can we still do this if we trade while at our day job that pays the bills, meaning I just day trade for a side hustle?

@TraderChick 29 дней назад

Can you talk about how to pay quarterly taxes with unknown fluctuating future income as a day trader? Thank you 🙏

@wma79351 2 месяца назад

That's why we need flat tax!!!

@iosiftimofticiuc9043 3 месяца назад

What about Traders from outside the US. We pay taxes in US and then again in our country? And if we pay taxes in US, what do we pay exactly?

@j-vx3pu Месяц назад

Hi Ross, thank you so much for your content. This is my first year of investing and I would have never thought about ways to pay less income tax. My investments are currently under my name, do you know if I can set up an s-corp and transfer my investments into it?

@DaytradeWarrior Месяц назад

We'd recommend reaching out to a CPA or accountant for help with this.

@UsefulElectrons-ni1fq 2 месяца назад

Where does the business get its initial finances to trade with

@user-rl5yy6qi8h 2 месяца назад

I am quite confused and can you please explain. I have been told that one cannot do Trading or Generate Investment money from Stock Market, under S-Corp. The income generated by S-Corp is treated as Capital gains and is passed to the S-Corp officer. No deductions are taken against trading or investment income

@d.keithshores4500 3 месяца назад

When trading out of the Roth, that Roth account is under your S Corp correct not your personal Roth

@DaytradeWarrior 3 месяца назад

A Roth is in your personal name

@galactic25 3 месяца назад

I was wondering, others say you need a certain large capital requirement to open a trading account as a business; Webull’s is $100k. If you start an S-Corp, can you use it as your holding company for your individual trading account?

@VisionClearly 2 месяца назад

Good question!