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GTT RESOURCES: SELF EMPLOYMENT TAX

Unlike all other types of "sole proprietorship" or "unincorporated" businesses, securities and/or commodities traders, with trader tax status, with the mark-to-market or cash methods of accounting, are exempt from self employment taxation (SE taxes). Their trading gains are not deemed "earned income" for purposes of SE taxes, health insurance premium deductions (from adjusted gross income) or for retirement plan contributions.

Note, commodity traders who are registered as dealers or traders on a commodities exchange are subject to SE taxes. See more details about this exception in our Commodities Examples Guide.

Proprietary traders who are treated as independent contractors receive a Form 1099-Misc for non-employee compensation. They are usually subject to SE tax. Click here to learn more.

If you have questions about whether SE taxes apply to you, e-mail us at info@greencompany.com

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