Our entity tax strategies require eligibility for trader tax status (TTS). With TTS, an individual or entity can deduct business, start-up, organization, and home office expenses. An S-Corp is necessary for a TTS trader to arrange the owners’ health and retirement plan deductions. LLC/partnerships or S-Corps help ring-fence trading positions vs. overlapping investments. The SALT cap workaround strategy allows pass-through entities (partnerships and S-Corps) to save taxes. See more on our Entity Solutions page and June 2022 blog post and Webinar for “How to Set Up a Trading Business for Optimal Tax Savings.”
The Entity Tax Consultation is a 60-minute meeting with Robert A. Green, CPA, by phone, Skype, or Zoom. It includes:
- Determine if your trading entity will be eligible for trader tax status (TTS), which is a requirement for the trader tax benefits.
- First and foremost, is an entity cost beneficial to you: Do the tax benefits exceed the costs? Many traders think they need an entity when they don’t, or they can wait longer to form one.
- Choice of entity focusing on tax benefits: Single-member LLC taxed as a disregarded entity, LLC taxed as an S-Corp, spousal-member LLC taxed as a partnership, a corporation taxed as an S-Corp.
- State of formation for an entity, usually in your home state where you have nexus (live, work, and trade).
- Tax treatment when a spouse is an active owner vs. a non-active spouse.
- Tax advice on considering a Section 475 election on securities and/or commodities by internal resolution within 75 days of inception.
- Tax strategies in arranging health insurance and retirement plan deductions via payroll in an S-Corp.
- Tax attributes of different retirement plans like an S-Corp Solo 401(k) vs. other types of programs.
- Advice on capitalizing start-up costs and entity organization expenditures.
- Advice on accounting solutions that fit your needs.
- Tax advice on using an S-Corp accountable (expense) reimbursement plan.
- Tax advice on how partners can deduct “unreimbursed partnership expenses” (UPE).
- Tax advice on a ring-fencing solution: TTS trading with Section 475 in an entity, separate from investments on the individual level without 475.
- Tax advice on using a SALT cap workaround strategy in twenty-plus states.
- Tax advice on state and local income taxes that apply to a TTS partnership or S-Corp in your home state. Some states exempt a trading entity from state and local taxation.
This entity tax consultation does not include an entity formation service.
If you have any questions, don’t hesitate to contact us at email@example.com.
Robert A. Green, CPA
CEO, Green & Company, Inc.