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Portfolio123 » List all forums » Forum: General Comments » Thread: Taxachusetts |
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Total posts in this thread: 6 |
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charles123
Advanced Member
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Anyone here from MA. Does anyone else realize that nearly 50% of our gains go to taxes on these ports. Assuming you manage to earn your way to the top federal tax bracket, there goes what 33%. Then MA short term cap gain is 12%!!!!. That's 45% to taxes. Just wanted to know who else has come to the realization that MA is not the place to be a trader? |
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jpkernot
Advanced Member UNITED KINGDOM Joined: Oct 9, 2005 Posts: 223 Status: Offline |
Go find yourself a tax haven! It's 40% here in the UK. However, it will drop to 18% next year. Is the UK now a tax haven? Probably not: lousy beaches, lousy weather and warm beer. But a super strong currency!  ---------------------------------------- Thanks! |
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dwpeters
Advanced Member
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Hi, I've heard that it may be possible to trade under the umbrella of an LLC, reducing the tax burden (in the US): http://www.aiqsystems.com/June05%20OBM.pdf (see p. 6 & 7). Anybody have any experience with this? Don |
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synhawk
Advanced Member
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It's 9.3% here in the PRC (peoples republic of california). We have decent weather if you are near the coast (and I mean within 10-15 miles), but that's about it. Welcome to american socialism without the various benefits you would typically see in other systems  If you're not making atleast 25% CAGR on your short term approach... it might be a waste of time  ... unless you have big risk control benefits from your approach over a good longer term approach.Fight for low short term capital gains rates I say! That or time to leave the country with this bad currency, high cost of living, high tax rates, degrading freedoms, etc  It's sort of depressing when our friends across the pond with their historically insane capital gains taxes are going to 18% with a very strong currency (coincidence? ) |
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hengfu
Advanced Member
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I am not an account to give you tax advise. You can Google "IRC 475 MTM trader status" find a lot info. Basically, instead of $3000 writeoff, trader status using LLC (if you qualify) gives you tax loss insurance against gains from earlier years. And capital gains are converted to ordinary income, which means the gains up to aroudn $45k per year can be put into a solo 401k to invest tax deferred. Schwab and Fidelity both offer solo 401k. It is extremely easy to setup a LLC in California, just follow any Nolo LLC book. But it costs almost $1000 per year to run a LLC here in California. |
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gfagerlin
Advanced Member
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All: You can set up an LLC in Nevada and Delaware for about $100/yr. I did it once for a business venture. Your NV agent handles everything for a nominal amount. Google "LLC Nevada" I also have a couple of CA LLCs and the state tax is about $800/yr. I am not an accountant or tax guy but I think an LLC would pass profit to its members which would result in tax in Taxachusetts (your income from your NV LLC). I had not thought about the IRA benefit but that looks like something worth looking into. Glenn |
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