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Barbara, Enrolled Agent
Category: Tax
Satisfied Customers: 2665
Experience:  18+ years of experience in tax preparation; 25+ years of experience as a real estate/corporate paralegal.
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I am about to start trading as a proprietary trader, trading

Customer Question

I am about to start trading as a proprietary trader, trading a funds money. I will be paid for my profits on a 1099. Is that income subject to a B&O tax since the 1099 will be paid to my two member LLC?
JA: The Accountant will know how to help. Is there anything else important you think the Accountant should know?
Customer: The LLC was created specifically to treat trading as a business in an entity, to make it a legal way to obtain trader's status with the IRA.
JA: OK. Got it. I'm sending you to a secure page on JustAnswer so you can place the $5 fully-refundable deposit now. While you're filling out that form, I'll tell the Accountant about your situation and then connect you two.
Submitted: 5 months ago.
Category: Tax
Customer: replied 5 months ago.
The business is resident in the State of Washington, hence the question about a B&O tax.
Expert:  Barbara replied 5 months ago.
Welcome to Just Answer. My name is ***** ***** I will be happy to assist you.There is a B&O tax exemption for investment income (including gains from trading in stocks, bonds and other marketable securities, as well as dividends and capital gains from equity investments in other businesses). This exemption does not generally apply to interest income, however, and it does not apply at all if the company receiving the income is considered a “banking, lending or security business.” let me know if I can assist you further.Thank you and best regards,Barb
Expert:  Barbara replied 5 months ago.
Just following up with you to see if you have any other questions or concerns. If so, please come back to me here, and I will be happy to assist you further.Best regards,Barb