I trade only 1256 contracts (SPX options). Is there any benefit in trading through Entity like general partnership or LLC? According to my Math, Cost of having Entity(Yearly renewal fee, data fee etc) is more than I can save on taking deductions(which are like home office, internet, ONE subscription etc)
Am I missing something here. I would appreciate any advise.
I am not a professional and recommend a consultation with one.
My understanding is unless you qualify for trader tax status or even close to qualifying, do not bother setting up an entity.
I did setup a trading LLC and currently working with TD Ameritrade on doing an internal transfer. My situation is uncommon though. I am physically disabled and looking to enroll in a government program to receive services private health insurance does not cover. The program has a $20K asset limit. My top options are to trade under a trust or a LLC. I chose the LLC.
Also, if you trade under an entity, it may take longer to deposit and withdraw money. To withdraw money I will need to transfer from the trading account to a business checking account and then transfer the money to a personal checking account.